Tuesday, August 16, 2011
Wal-mart no longer seen as the low-price leader
According to MSN.money, Wal-Mart's crown as the low-price king has been tarnished, and Target is poised to take over the throne.
Wal-mart, which prides itself on its motto of "Save Money, Live Better," appears to have lost its price perception among consumers. According to a survey conducted by WSL Strategic Retail, 86% of Wal-Mart shoppers no longer believe the retailer has the lowest prices.
"Every brick-and-mortar retailer lowered prices and shouted sales throughout the recession, while the Internet became the go-to place for shoppers in search of the lowest prices," the report said.
Wal-Mart's image erosion started earlier in the year when rival Target narrowed its pricing gap with the retail behemoth. Target reduced its prices on key items shoppers remember most, like milk, cereal and diapers - those key items appealing to the "mom shopper" who knows the prices of these products down to a penny and can see they are saving money at Target.
This raises a serious question: If Wal-Mart no longer stands for everyday low prices in the eyes of consumers, what does it stand for? This is something Wal-Mart needs to figure out quickly, as it is poised to report its ninth consecutive quarterly decline in U.S. same-store sales. And while Wal-mart is struggling to woo shoppers, Target has seen its traffic improve for six consecutive quarters.