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Call it a tale of two discounters. Target posted their earnings this week and while net sales were up 0.4%, it was not as impressive as Wal-Mart which saw its net sales increase by 3.8% for the first quarter.
It is interesting that these two giant discounters are moving in opposite directions at this point in the downturn. As my colleague Matt Boyle pointed out in his blog post Wal-Mart’s Upcale Shift, Wal-Mart is hoping to lure a more affluent consumer now and hopes they will stick around when the economy picks up.
Target in contrast stumbled this past fall because it had more discretionary merchandise than Wal-Mart. Target is now making a big push into essentials through initiatives such as expanding its supermarket division in the hopes of capturing a more value-oriented shopper.
Target is also taking a page from Wal-Mart with its new focus on moms. Target is launching a broadcast campaign with “real moms” who talk about the money they saved at Target. Wal-Mart has realized mom controls the family budget for some time. It sends products to moms like Tara Kuczykowski, a mother of five. Tara blogs about ways for moms to save money and if she likes a given Wal-Mart product she will review it on her site.
Who will win? Target or Wal-Mart?
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