tag:blogger.com,1999:blog-4815867514277794362.post7274503434371007165..comments2024-03-08T06:18:28.125+11:00Comments on Bronte Capital: The end of Target's school charity program: demographic change or just bad management?John Hemptonhttp://www.blogger.com/profile/03766274392122783128noreply@blogger.comBlogger15125tag:blogger.com,1999:blog-4815867514277794362.post-37653756491926044832016-10-03T00:08:28.267+11:002016-10-03T00:08:28.267+11:00I must say I find Target a possibly compelling sho...I must say I find Target a possibly compelling short. I really don't see its point of differentiation in the market. It lacks Wal-Marts low costs so cannot compete on price. It has a sizable food business but it isn't compelling compared to Wal-Mart/Costco/Kroger. It's electronics is an after thought. It's apparel business isn't that price competitive in a world where TJ Maxx and H&M are gaining share. It's home business is OK but not a huge driver. It's online business isn't compelling either. It is probably getting some customers who may have been going to Kmart as Kmarts continue to close, so maybe that helps Target next year.<br /><br />They are at best OK in a number of product categories but compelling in few, and their only market is a strugglin upper lower middle class customer who wants to say 'times are tough but at least I'm not shopping at Wal Mart!".which isn't enough. Not going away but I see this a slowly leaking balloon.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-46895530897520005122016-09-20T05:50:58.995+10:002016-09-20T05:50:58.995+10:00Another post as a pretext for Ackman bashing? At ...Another post as a pretext for Ackman bashing? At some point it may prove useful for your general mental and physical well being to move on with your life. You were right about VRX and HLF - there, you get the credit publicly...and yes Ack was a big meanie to insult you to your clients. Satisfied? <br /><br />Your Ackman obsession is all getting a wee bit boring at this point (hint - your blog used to be really entertaining - go back and read your early posts - now it's become insufferable, like the rantings of a bitter old man).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-50543710231381761172016-09-20T00:54:06.743+10:002016-09-20T00:54:06.743+10:00Another post devoted to Ackman bashing [using the ...Another post devoted to Ackman bashing [using the lame pretext of examining Target's CC program]? You are like the guy that got dump by his girlfriend in 7th grade and is whining about it 30 years later. At some point don't you just, like, move on with your life? It's a seriously unhealthy obsession you've developed. Please get help soon.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-20763233567704961822016-09-18T01:32:18.356+10:002016-09-18T01:32:18.356+10:00I find the demographic case pretty reasonable. Th...I find the demographic case pretty reasonable. The linked article quotes a Target source that only 10% of cardholders enrolled in the program.<br /><br />That number is heading ever lower.<br /><br />The next generation of Target customers just find having kids too inconvenient. <br /><br />RAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-69505988908081340682016-09-15T05:21:03.501+10:002016-09-15T05:21:03.501+10:00John, Didn't TGT sell their credit card busine...John, Didn't TGT sell their credit card business to TD Bank in 2013? Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-70887974784314266092016-09-15T04:41:33.042+10:002016-09-15T04:41:33.042+10:00I think the most likely scenario is that this is a...I think the most likely scenario is that this is a sizeable profitability lever that is too good to leave unpulled. You see a lot of retailers, and non-retailers like airlines, devalue rewards points and I see this as a similar move. Target is already giving away 5% discount for Target card usage in-store, and I personally would view the charitable donation as a secondary value proposition anyways -- thinking this may be how they rationalize removing the benefit.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-2696590633496288282016-09-15T03:34:26.124+10:002016-09-15T03:34:26.124+10:00So your theory is that you know Target's credi...So your theory is that you know Target's credit card dynamics better than they do (based upon a couple of conversations) and therefore their decision to change the underlying driver of its success shows they don't understand it and will ultimately hurt it? Im willing to bet they know the motivations and drivers better than anyone and wouldn't intentionally do anything that would kill the golden goose.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-21062002354483821392016-09-15T02:47:42.112+10:002016-09-15T02:47:42.112+10:00I'm sure you're aware of this, but they so...I'm sure you're aware of this, but they sold their receivables portfolio to TD Bank Group in 2012 along with the underwriting and and risk management rights (https://www.sec.gov/Archives/edgar/data/27419/000110465912070517/a12-24761_1ex99.htm). <br /><br />I figured that the recent changes probably had something to do with the internal dynamics of that relationship rather than a specific strategic change? Though that's pure speculation on my part.Casual Sophistnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-48619074811934396572016-09-14T23:43:14.941+10:002016-09-14T23:43:14.941+10:00Broad and unsubstantiated attempt at a thesis and ...Broad and unsubstantiated attempt at a thesis and response here: Isn't it possible that the entire US consumer-credit industry has been overextended for a while and is now starting to gradually wilt in from the edges (lending club)?a dognoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-82840359254564151482016-09-14T22:58:15.485+10:002016-09-14T22:58:15.485+10:00I was delighted to learn about the number of custo...I was delighted to learn about the number of customers who use the card to get the 5% back and then walk over to the service desk and pay off the balance. The people at the Service Desk so have told/confirmed this seem delighted as well.<br /><br />I wonder how much Target (and alternatives) do to get the schools to sell the program. Who knows, maybe Target dropped the ball on that side first. exuberancehttps://www.blogger.com/profile/02180872922559635562noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-67060873575841154682016-09-14T22:55:28.801+10:002016-09-14T22:55:28.801+10:00Hey Global Trader - you proved yourself unable to ...Hey Global Trader - you proved yourself unable to read. The respect for management dated 2001. <br /><br />Different time, different management.John Hemptonhttps://www.blogger.com/profile/03766274392122783128noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-79422842357995807732016-09-14T22:23:47.033+10:002016-09-14T22:23:47.033+10:00It's an interesting hypothesis, although it is...It's an interesting hypothesis, although it is not clear to me why customers would think their school would find out about their default. But if they do, do you think Target just lucked into this happy arrangement, which curbs default rates, or did they somehow subtly encourage this misconception? And if this is the case, why kill the goose that lays the golden eggs? At least they should sell it, as Ackman suggests, not just kill it.Wilberhttps://www.blogger.com/profile/04728227021889501327noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-59533660279687464062016-09-14T20:11:46.572+10:002016-09-14T20:11:46.572+10:00Respecting management that cheated in a proxy cont...Respecting management that cheated in a proxy contest and now are under criminal investigation. classic hemptonGlobalTraderhttps://www.blogger.com/profile/01717693276747483404noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-69686658598345209922016-09-14T17:48:54.645+10:002016-09-14T17:48:54.645+10:00Have you checked if the default rates have changed...Have you checked if the default rates have changed? ie have people stopped believing their kids' schools will find out or stopped caring?Rasiing_the_basehttps://www.blogger.com/profile/04003641605242163860noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-50790878701519178042016-09-14T17:35:11.297+10:002016-09-14T17:35:11.297+10:00The one thing you never want to hear your marketin...The one thing you never want to hear your marketing people say...<br /><br />"We just want to continue to innovate."<br /><br />She almost literally says "it isn't broke but we wanted to fix it". Someone's building their own career here and decided that they weren't going to get to the top by competent administration of someone else's iconic program.Dan Daviesnoreply@blogger.com