Target Will Match Prices of Amazon, Walmart.com, Other Online Retailers Year-Round

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Target Price matching
Target (TGT) announced a bold new program Tuesday morning, promising to match the prices found on online retail competitors including Amazon.com (AMZN) and Walmart.com (WMT). The new policy is similar to the one Target implemented during the 2012 holiday shopping season, but now, it will operate year-round.

Mark Schindele, Target's senior vice president of merchandising operations, explained in a blog post that Target received such positive feedback on the holiday price match policy, it decided to make it permanent.

Under the new policy, customers will get a price-match if they can provide proof of a lower price at Amazon.com, Walmart.com, ToysRUs.com, BabiesRUs.com or BestBuy.com. They can also score a retroactive price-match if they bring in proof of a lower price (and their receipt) within 7 days of their purchase. Target will also price-match its own website, as well as any deals you later find in the following week's weekly ad. And shoppers using Target's REDcard can still get their 5% discount on top of the price match.

The policy outlines a few exclusions: Stores won't price-match third-party vendors on these sites, such as Amazon's "marketplace" sellers. Target stores in Alaska and Hawaii won't be participating. And online prices that can only be had through clearance sales or percentage-off promotions are ineligible for the price-match policy. Target will, however, continue to price-match local retail competitors.

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As we noted when Target and Best Buy (BBY) announced their online price-match policies during the holiday shopping season, the move seems aimed at the growing ranks of "showroomers" -- shoppers who browse and try out products in stores, then buy those products at lower prices online. By offering to match the prices customers find on their smartphones, Target can avoid losing those sales.

The downside is that Target will see its profit margins shrink on price-matched sales. Even Amazon, with its comparatively low overhead, is having trouble turning a profit while maintaining its current low prices and slim margins. If legions of shoppers come into Target asking associates to price-match Amazon, then the retailer will likewise feel the pinch.

But after a disappointing holiday season, Target is evidently willing to tighten its margins if it means retaining customers who would otherwise be lost to the online retail machine.

Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.


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