A Profitero study showed Target’s online prices were 25% more expensive than Wal-Mart’s, which were just slightly more expensive than prices on Amazon.
Target pulls Amazon's Kindles from store shelves.
In a move many see as a sign of Target Corp.'s increasing frustration with rival Amazon.com Inc., the multichannel retailer announced plans to stop selling Amazon's Kindle tablet computers and e-reading devices.
"Target continually evaluates its product assortment to deliver the best quality and prices for our guests," says a Target spokeswoman.
Target began selling Kindles in its stores in 2010. During the 2011 holiday shopping season, it even boasted about the strong sales of Kindles on Black Friday, the day after Thanksgiving. "This was a great Black Friday for Target and for Kindle Fire, which was the bestselling tablet in our stores on Black Friday," said Nik Nayar, Target's vice president of merchandising, in a statement distributed by Amazon in late November. "We're excited so many guests chose Target as their destination for the new family of Kindle devices and we're sure Kindle Fire will continue to be at the top of wish lists this holiday season."
However, the announcement that Target will stop selling Kindles came only months after the retail chain in January made clear it planned to step up its defenses against what's come to be called "showrooming," consumers with smartphones using physical stores to examine products that they then buy online, often from leading e-retailer Amazon. The chain earlier this year asked some suppliers to renegotiate their agreements with Target so the chain can compete on price with online-only retailers without wrecking its profit margins and to make available to Target products that aren't available from web retailers.
Target is not just cutting off Amazon but also cozying up to Apple Inc., which makes the iPad tablet that Kindle Fire competes with, says Paula Rosenblum, managing partner at research and advisory firm Retail Systems Research LLC. "I think there's no question this decision is about cutting ties with a competitor, Amazon, while improving ties with a Ôcool and sexy' brand, Apple," she says. "It's a good decision."