Target launches its Canadian ad campaign during Oscars as it readies new stores

TORONTO - Two years after U.S. retailer Target announced plans to move into the Canadian marketplace, the company is nearly ready for its north of the border television debut.

On Sunday, during the first hour of the Oscars ceremony, the company will showcase its first Canadian TV commercial touting its entry into the "neighbourhood."

The 60-second spot paints the Target brand as a friendly new neighbour, set to a remake of the theme from "Mister Rogers’ Neighbourhood" recorded by Canadian band Dragonette.

In the commercial, a woman rides a motorcycle with the Target dog sitting in the sidecar, as the two scoot cross-country past numerous landmarks and events. Brief nods are made to Moving Day in Quebec, ice skating in Toronto and a lighthouse in St. John's.

There are "some little cultural nuances and insights that we weaved in," said Livia Zufferli, marketing director of Target Canada in an interview.

"We wanted to just celebrate Canada."

The commercial was directed by Mark Palansky, the Canadian who recently made "Penelope," a fantastical romantic comedy starring Christina Ricci.

A different version of the commercial will air during "La Voix" in Quebec, with an original song penned by local band Alfa Rococo.

Print advertisements will also being to appear in newspapers and online next month.

Target plans a national rollout of its 124 Canadian stores starting next month in Ontario before moving onto provinces in the West throughout the year and eventually into Quebec. The company hasn't announced any official opening dates.

While fanfare around the launch has been strong over the past few months, the company will have its share of challenges ahead, particularly when it comes to living up to its low-priced image. Canadians who live near the U.S. border commonly head south to take advantage of cheaper retail prices, and some have questioned whether Target can truly replicate its stores north of the border.

Other U.S. retailers like Walmart sell many items cheaper than other competitors in Canada, but they are often still notably more expensive than the U.S., even when taking the currency exchange rate into consideration.

"It's a different market to do business in, and different factors that impact pricing," Zufferli said.

"For us it comes back to being as competitive as we can in the Canadian market."

Canadian consumers have "low-priced benchmarks in their minds," and they will be "pleasantly surprised" with the new Target stores, she said. Some prices will be higher while others will be lower than the U.S. locations.

Target also offers an additional five per cent discount when customers pay with their branded Red Card, which is available as either a debit or credit card.

Target spent more than five years weighing its entry into Canada before making the move in 2010 when it acquired most of the real estate assets operated by Zellers.

One of the company's biggest initial concerns was whether the Canadian properties would fit the trademark Target look, which emphasized wide aisles and a broad array of products.

"Some of them are different than our prototypical model would be in the U.S., so it was an interesting task for our teams," said Zufferli.

Ultimately, the company spent about $10 million on each location for renovations both inside and outside the stores, she said.

Still, there were some factors the company couldn't renovate. On average, the Canadian Target stores will be about 18 per cent smaller than its properties in the United States.