Walmart ☀

[Del Tachi]

What about Walmart's reputation, or rather its patrons? When ever I read, hear or see something about it, I perceive it as an allegory of white trash, uneducated, overweight America. Maybe I could be wrong, but these views are always connected with Walmart.

This reputation is mostly because Walmart is the only big-box retailer with significant locations in rural and small town America.  Walmart's competiters like Target tend to be much more concentrated in urban or suburban areas. 

Despite the perception that Target is "higher end" than Walmart, Walmart's financials are in much better position and I imagine that they will outlast Target by decades.  Target's problem is that they attempt to compete for higher-end "suburban" shoppers in areas where that demographic has ample boutique or specialty retail options.  Walmart's philosophy is to basically be the only game in town for the millions of rural Americans in the South and Midwest.

[Del Tachi]

What about Walmart's reputation, or rather its patrons? When ever I read, hear or see something about it, I perceive it as an allegory of white trash, uneducated, overweight America. Maybe I could be wrong, but these views are always connected with Walmart.

This reputation is mostly because Walmart is the only big-box retailer with significant locations in rural and small town America.  Walmart's competiters like Target tend to be much more concentrated in urban or suburban areas. 

Despite the perception that Target is "higher end" than Walmart, Walmart's financials are in much better position and I imagine that they will outlast Target by decades.  Target's problem is that they attempt to compete for higher-end "suburban" shoppers in areas where that demographic has ample boutique or specialty retail options.  Walmart's philosophy is to basically be the only game in town for the millions of rural Americans in the South and Midwest.

I don't think Target being "higher-end" than Wal-Mart is perception necessarily. The issue is that middle-market retail is struggling, but low-end retail is doing well, generally, across the board. It's not just Wal-Mart - sellers of true crap like Dollar Tree/Family Dollar and Dollar General are also flourishing. Target suffers because it's trying to focus on middle-income buyers more than low-income buyers, but middle-income is a tough market these days.

I actually don't think I've been inside a Wal-Mart, or at least not more than once or twice in my life. There is no Wal-Mart in NYC even today, I don't think (or if one has opened in the past few years, it's not transit-accessible).

Yes.  Middle-income retail is harder because your shoppers have more opportunities of where to shop - namely local boutiques, specialty stores, department stores, and online.  Middle income people still spend beaucoup money on retail, it's just increasingly online or in specialty outlets.

Also, think about how much of Walmart's sales are driven by household and perishable items (i.e., groceries, toiletries, cleaning supplies, etc.) versus Target, whose sales are more reliant on apparel, personal accessories, and home goods.  The retail markets where Target currently excels are much more likely to be replaced by online options.

[Del Tachi]

This idea that Wal-Mart is where you go for sundries and you go to Target to buy a cute bracelet and a napkin holder isn't really true.  The urban smaller format Targets focus on the basics the most knowing you can get the napkin holder at Williams Sonoma.  Their competitors are CVS and Walgreens in these areas.

I just really don't think this is true.  Consider the relative amount of floor space dedicated to apparel/home goods vs groceries/sundries in a suburban Target vs a suburban Walmart.  Also consider that Target has several differentiated store brands for these items, whereas (I think) Walmart only has a single store brand for each differentiated product.  While I don't have any raw data to back this up, I think it's pretty apparent based on retail placement/product promotion that Target relies much more on what I'll call "single purpose retail" - that is, people making a dedicated trip to a specific store to buy a specific item (typically apparel or a home decor item).  That's exactly what makes them much more vulnerable to being "squeezed out" by online or local retail options.

CVS and Walgreens are really different animals in retail because 1) they're primarily retail pharmacies and 2) they compete spatially.  Since the local retail footprint of a CVS/Walgreens is quite small (no one is going to drive across town to go to one), they compete for your dollar by being the closest, most convenient option.  That's why a CVS will open up right across the street from a Walgreens (or vice versa) - because consumers don't really care which one they go to, they'll just go to whichever one is closer.  The convenience thing also results in CVS/Walgreens being a lot smaller than Target/Walmart (the point is to get shoppers in and out quickly), which makes them very well-suited to urban environments.  Target has to some extent copied this model in urban areas, but it's not their default or preferred store layout.