Can Target Compete with Wal-Mart?

Jun 10, 2002

Each successful step that Target, the nation’s second-biggest discounter, takes brings it to closer confrontation with the world’s biggest retailer/company, Wal-Mart. Because most shoppers have a choice, the question becomes whether the two companies can coexist, reports The New York Times.

“They are getting 40 percent of their growth from SuperTarget this year,” says
Michael Porter, a retail analyst for Morningstar in Chicago, referring to Target’s
plans to increase its grocery operations. “And that puts them squarely in Wal-Mart’s

In some areas, Wal-Mart has already shown how it intends to compete with Target,
which promotes “fast, fun and friendly” service. For example, Wal-Mart hired
extra workers in some stores in Phoenix earlier this year to try to beat Target
in the crucial area of customer satisfaction, according to Burt Flickinger III,
a managing partner at Reach Marketing, a retail consulting company in Westport,
Conn. It is a tactic that can be replicated almost anywhere, because about 70
percent of Target’s stores are in markets where there is also a Wal-Mart.

Moderator Comment: Can Target Thrive in Wal-Mart’s
Cross Hairs?

Wal-Mart is the biggest but Target has the potential
to be the best. In our humble opinion, Target is more of a threat to Wal-Mart
than it is generally given credit for. [George
Anderson – Moderator

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