Target’s risky snub of Beyoncé

December 19, 2013

(Photo by Robin Harper/Invision for Parkwood Entertainment/AP Images)

Back in 2011, Beyoncé was making appearances at a Target manager's meeting, starring in Target commercials and letting the mass retailer carry an exclusive version of her last album, "4."

Two years later, Target is refusing to even carry Queen Bey's latest album, which hits store shelves on Friday.

What happened? As everyone knows by now, the mega star upended the music industry last week when she surprised the world with her latest album, "Beyoncé." Rather than cutting exclusive deals with retailers or following the usual formula (single releases and lots of pre-sale marketing leading up to the launch date), Beyoncé simply let her millions of fans on Instagram know that moments later her new album would drop on iTunes.

Target wasn't so crazy in love with the move.

In response to the surprise release, the company told Billboard that "we focus on offering our guests a wide assortment of physical CDs, and when a new album is available digitally before it is available physically, it impacts demand and sales projections. While there are many aspects that contribute to our approach and we have appreciated partnering with Beyoncé in the past, we are primarily focused on offering CDs that will be available in a physical format at the same time as all other formats."

At this time, Target said, it would not be carrying the album. When I reached out for further comment, Target spokesperson Erica Julkowski sent the same statement and said it was all the company had to share for now.

Target's strategy, we have to assume, isn't to get back at Beyoncé but to send a message to other artists: Follow Queen Bey's lead, and we won't sell your record. As the fourth largest seller of music, according to Billboard, Target appears to be trying to stand its ground and make an example of her to prevent other artists from following suit.

Even so, it's a head-scratcher. There are the sales Target is bound to lose, for one—not only from the album itself, which so far has been the fastest-selling record in iTunes' history, but from people who would have gone into Target for the album and come out with (as we all do) a grocery cart full of laundry detergent, wrapping paper and underwear. Spin's Chris Martins tried to describe the retailer's approach this way: "Since there's a chance we might sell fewer copies than we'd hoped (for an album no one knew was coming), we'll sell zero copies instead." Makes a lot of sense, no?

Then, of course, there are the reputational risks for Target. Particularly given the context of the company's past relationship with Beyoncé, Target has already been accused of looking petty and even spiteful for choosing not to carry the release. As one ABC News headline blared, referencing a track on the new album, "Target plays 'Jealous' ex-lover to Beyonce."

The company's move appears defensive, says Rita Gunther McGrath, a Columbia Business School professor and the author of The End of Competitive Advantage. "It's 'I'm taking my bat and ball and going home.' "

In today's world, McGrath says, strategy must be dynamic, flexible and nimble enough to change quickly. "We've got to go from a strategy where you put a moat around it and defend it, to a strategy where you build an advantage and then be prepared to move on when it's time," she says. And in Target's case, it just may be time. Says McGrath: "It’s tough to see what they’re going to win out of this."

Jena McGregor is a columnist for On Leadership.

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Jena McGregor writes a daily column analyzing leadership in the news for the Washington Post’s On Leadership section.
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