Market Analysis for Target

Target is the second leading discount store in the United States, which makes looking at market structure easy to identify. In this case Target would be considered a perfect competition market structure due to several factors. This type of marketing structure also helps to explain the financial performance that Target has and how it is able to maintain its position among the U.S.’s discount stores. By understanding more about market structure, we are able to understand how companies, such as Target, are able to be so successful.
The first thing that must be understood is the type of marketing structure that Target is in. Since Target is most like a perfect competition market structure, which is described by five criteria a company must meet. The first criterion is all firms sell an identical product, which is true of Target in comparison to stores like Walmart, Amazon, and K-Mart. The second criterion is all firms are price takers, which means that they are unable to control the prices of the products they sell. The next criterion is all firms have a relatively small market share. The fourth criterion is that the buyer has complete information about any product being sold and the prices of these products. The final criterion is that the industry allows for freedom of entry and exit (Investopedia, 2014). All of these criteria, Target meets, because there are several dozen other discount stores that exist in which Target must compete with (Hoovers, 2014).
The products that are available at Target can easily be found at a variety of other stores or online, which also makes them perfect for this type of market structure. In terms of entry, perfect competition allows for any company to enter into the market without many issues. The o...

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...ited to their advertisement strategy as well as their marketing strategies. One way that Target is able to do this is by offering products that are not available in other discount retail stores, but must be purchased online. By having contracts with the companies that produce certain goods, it enables Target to limit the amount of competition that may be seen in some areas and bring in more customers.
By understanding the market strategies that large corporations fit into and use, we are able to understand how they become so successful. Target is simply one of many examples and we are able to see that by competing with other large discount retail stores, they are still able to be the second largest in America. The strategies that they implement are what help to make them so successful and how they are able to see continued growth each year they remain in business.