Could Wal-Mart Become the New Target?

Have you been in a new Wal-Mart lately? They just opened a new Wal-Mart in Tiftonia recently and I went in there a week ago. No longer your parent’s Wal-Mart. So why the change? One word: Target.

Target has been able to do something that Wal-Mart never dreamed of, build a reputation as a high-end, “fashionable”, reasonably priced retailer with a loyal base. Wal-Mart may have the lowest prices (thanks to their industry leading inventory system), but no one would ever make the argument that Wal-Mart was ever considered “fashionable”, let alone high-end. However, Wal-Mart never really had to worry about this because they really had no decently sized competitors. Well that all changed as Target began building Super Target shopping centers with more attention paid to interior details of the store and hiring well known designers like Isaac Mizrahi, Michael Graves, and Thomas O’Brien, to produce products specifically for Target. Suddenly Target looked like a viable competitor, an option for people with expensive taste on a budget. With the rising cost of living not met with a considerable increase in wage, this is becoming a larger market. It would appear Wal-Mart would have something to start worrying about.

So what was Wal-Mart’s reaction? Hire some of your enemy’s people. Wal-Mart hired an industrial designer and marketer from Target to revamp Wal-Mart’s image. They started selling products that Target has sold for years like Method brand cleaning products. You may have even noticed Wal-Mart’s recent commercials become a little more colorful and a little more “Target-like”. This all came together yesterday when I received this week’s Wal-Mart circular, where not only was Wal-Mart selling furniture that had a fashionable appearance like Target, several pages actually looked like they were straight out of Target’s weekly Sunday circular.

So why is this a big deal? This is Wal-Mart’s only missing piece. If Wal-Mart can attract shoppers who want more high-end, fashionable products, who will usually send more per trip, while keeping their current customer base, Wal-Mart will totally destroy Target. There are two things that Wal-Mart does incredibly well, handle inventory and negotiate ridiculous prices from their suppliers. They have THE most sophisticated inventory tracking system in retail, coupled with the ability to negotiate low, low prices by buying products in such large numbers. If Wal-Mart could begin to satisfy the niche that Target does currently, then Target is in BIG trouble. But hey, I could be wrong. All I know is I'm going to do my part. I'm going on my weekly trip to Target tomorrow.

Comments

A few things Wal-mart is forgetting. 1.) Their entire store has an odor to it that stays on your clothes long after you've left. 2.) They sell cigarettes. 3.) They want to hold on to their current customer base which includes every single annoying person you could ever possibly encounter. I guess focusing on better products is a step in the right direction but until they change the atmosphere -- even the colors of the stores make me feel blah -- they'll never be Target.

I boycotted Wal-mart years ago for the stress it caused when I entered their parking lots. From the parking lots to check out lanes and everything in between, Wal-mart is a stressful shopping experience for me. I'm honestly happier spending extra time making trips to different stores than I am to get it all over in one-stop shopping. I don't like the whole McDonald's/Optical Center/Bank/Video Arcade/Tire Center/Portrait Studio/Movie Rental thing they have going either.

The old Wal-mart vs. Target debate is an interesting one that makes me wonder why people care ... but we do (me? maybe a bit too much).

Good post!

Posted by: Joy at February 25, 2006 03:48 PM

The more likely scenario is Target will learn Chinese as well as walmart. They do not have far to slide. Both big boxes are competeing for the same dollar. Target cannot do the inventory that walmart does.
I won't shop at either, course I think it would help both if they would learn to parley in english. I just cannot see anywhere for walmart to go with its' image but up.
thanks for the post,
best regards

Posted by: glen at February 25, 2006 03:52 PM

I like goin' to the 'walmarts!' (But Tar-zhey sells cigarettes too.)

Posted by: Carl at February 25, 2006 04:03 PM

But Joy, my point was Wal-Mart is taking steps to change their atmosphere. That's why I brought up the fact that they hired one of Target's Interior Industrial Designers. The New Wal-mart in Tiftonia, is Green instead of the typical blue and the flooring is completely different (no dirty-looking, off white speckled tiles anymore). My point was that the new ones they are building are much different than the old ones. I think they are making a big step.

Posted by: Mr. Jonny Pantz at February 25, 2006 04:08 PM

Ah, okay. I mis-read and thought most of the changes were in the form of products. I'll have to check out the one in Tiftonia now. I'm curious!

Posted by: Joy at February 25, 2006 09:26 PM

Check out the Frontline episode on Wal-Mart. It's pretty heavy-handed, like the part where the camera man is filming the container port and they lower the thing down likes it's going to crush him--we're being inundated with cheap shit imported from China--but it's pretty interesting nonetheless. It makes me think you should come up with another word to describe Wal-Mart's 'ability to negotiate low prices.'

Posted by: Gideon Barnett at February 26, 2006 12:58 AM
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