Dollar Tree has a diverse product portfolio in comparison to other companies in its league. The product portfolio of Dollar Tree entails the following items: floral supplies and décor, party supplies, office supplies, teacher’s corner, art and crafts, toys and games, health and personal care products, cleaning elements, storage items, hardware, kitchen, and tableware (Dollar Tree Inc, 2012). In this regard, the target market for Dollar Tree is not limited to a particular age group; hence, it includes adults and children who make the bulk of consumers.
The diversity element in Dollar Tree enables it to attract varying consumer tastes. For instance, part of the Dollar Tree’s target market is the food and beverages sector offering a variety of processed products to its customers. This implies that the primary focus is on consumers who have busy lifestyles and prefer making their purchases via online setting. Another unique component of Dollar Tree’s target market is the education sector, where it offers students and teachers equal experiences (Dollar Tree Inc, 2012). Additionally, Dollar Tree has a special offer for party supplies, which shows its focus on the corporate market and members of the young generation. Finally, the company also focuses on emerging markets, which can be described as green markets that focus on energy saving items.
Description of Company Position in Target Market
Dollar Tree Inc has specifically established themselves as challengers in their market. Their aim is to challenge other players in the market through infusion of new things. First, there is a need to acknowledge that the position of Dollar Tree Inc in its market is mainly influenced by the consumption of food products, which form the company’s source of income. The position in the market is also strongly determined by the consumption of children toys and games, which form a critical component of the company’s successful strategy. As challengers, Dollar Tree Inc tries to employ new mechanisms compared to its competitors. For instance, new arrivals and closeouts tend to feature more of the children toys and games compared to other products offered (Dollar Tree Inc, 2012). Dollar Tree pursues a combination of functional and symbolic items. The company focuses on creating a perception of belongingness among its customers. This is an effective method of creating loyalty. For example, the company has new line products specifically intended for the Easter season.
Growth Strategy Matrix
The growth strategy pursued by Dollar Tree Inc does not indicate a preference for a specific mechanism. First, Dollar Tree Inc appears to be making significant efforts at market penetration. This is seen as Dollar Tree’s attempt to achieve better growth by relying on its existing product portfolio. For instance, Dollar Tree relies in a single pricing mechanism as opposed to the commonly used multi-level pricing mechanism in most stores (Tom, 2011). Thus, Dollar Tree Inc uses this single pricing mechanism as a platform to enter new market destinations. Secondly, Dollar Tree Inc also pursues new markets through market development strategies that target its present market segment.
Thirdly, Dollar Tree Inc also attempts to move to new markets by using diversification, which involves venturing into new markets and products. This is an effective strategy of countering increasing completion from other players in the market. For example, in the new arrivals section of Dollar Tree Inc’s website, the company has a new product under the name of emergency and disaster relief supplies (Dollar Tree Inc, 2012). This new product segment has the effect of broadening the market niche of Dollar Tree. Finally, product development is also cleverly infused with market development strategies to retain its current breed of customers by turning their focus to new products. This can be seen in recently introduced to turquoise stoneware plates as a new product element in the kitchenware (Dollar Tree Inc, 2012)
Dollar Tree Inc attempts to fit in to its current market niche through various adaptation strategies. In a market, where competition is relatively high, particularly from other competitor such as Family Dollar, 99 Cent Only, and Dollar General, Dollar Tree Inc is making numerous strides to ensure it captures the maximum percentage of the entire market. Firstly, Dollar Tree Inc attempts to attract other market segments that do not form part of its traditional clientele. For example, the target on art enthusiasts through its art and craft product portfolio further indicates on the extent to which the company has embraced diversification (Dollar Tree Inc, 2012).
Secondly, Dollar Tree also has a themed product portfolio that specifically targets special occasions. For instance, currently Dollar Tree has a specific line of products meant for the upcoming Easter season. They include oval paperboard Easter baskets, colorful oval woven bamboo Easter baskets, sports-ball-designed hollow plastic Easter eggs, and dairy chocolaty foil-wrapped Easter eggs (Dollar Tree Inc, 2012). Thus, Dollar is making good efforts to ensure that the company remains relatively profitably by targeting its products to attract Christians who are planning to celebrate the season in a special way. Thirdly, another market development strategy used by Dollar Tree Inc is through a combination of already existing features in the company’s product portfolio to merge tastes from different markets.