Office Depot Target Analysis

Office Depot Target Analysis

Brittni Fleming

Saood Baig

Donald Ballard

Rodnee Pope

This target analysis is meant to analyze the likely consumers who shop frequently at office depot and to identify their purchasing decisions based on demographics, psychographics as well as the mindset of the consumer.

With the majority of business sales occurring through catalogues (online or otherwise), the retail side of Office Depot caters much more to the home consumer. Demographics for home consumers tend to be between the ages of 18 and 50. This is a very large demographic which encompasses a large number of individuals. Consumers are likely college educated (or higher) and work in the professional services area. These individuals tend to shop at Office Depot for technology items (printers, computers, peripherals etc.), furniture and, to a lesser volume, office supplies. Home consumers are cross shopping every other retailer and e-retailer and competition isn’t limited to Staples. For instance, many of the products sold at Office Depot appear at Amazon, Wal-Mart, Target, Costco and Best Buy, just to name a few.

One demographic that is important for Office Depot are the millennials, of which there are more than 80 million in the US. Millennials prefer brick-and-mortar shopping and like to experience the merchandise. Millennials carry a lot of purchasing power, currently estimated at $200 billion (direct) and $500 billion in indirect with peak purchasing power still a few decades away. Additionally, millennials are social media conscious with more than three quarters participating and on average spending more than 1.8 hours on social media sites. Unsurprisingly, they also value the recommendations of peers and friends.

Businesses make up a large part of this target analysis. Small businesses make up a large portion of Office Depot’s clientele.  Office Depot currently directly sources about 5% of their merchandise which is where they buy both brand name and private label goods from a wholesaler instead of through a middleman.  By using this method, Office Depot is able to offer their office supplies to small businesses at a much lower price since middlemen costs have been eliminated.  Office Depot has been able to make their website appeal to small businesses by offering an online catalogue showing the discounted bulk pricing and making online ordering a streamlined process once the business as created an account.  

Another service that Office Depot designed to target small businesses is their printing and copying center. Small businesses and organizations currently account for 75% of their market revenue for this service. It became easier and more efficient for these small businesses to send in their professional prints to be processed than pay for the equipment and supplies on their own. Office Depot also started offering shredding services for these companies at a lower price than private shredding companies.  Since the services are not offered by Wal-mart and other retail stores, it was easier to have small businesses and organizations as a quality target market.