Wal-Mart Tries To Get Back On Target
Today's WSJ (its first ever Weekend Edition) reports news that Wal-Mart Begins A Big Makeover:
Wal-Mart Inc. has begun a fundamental rethinking of the formula that made it the world's largest retailer.
Wal-Mart grew enormous by cramming its shelves with merchandise at the lowest prices possible. Now, responding to big shifts it sees in the American economy, it is changing the way it does business to reach out to more upscale shoppers.
This month, Wal-Mart unveiled an eight-page advertising spread in Vogue that uncharacteristically emphasized fashion, such as a leopard-print tank top with pink lace, instead of price. On Monday night, the huge public screen in Times Square will display video from Wal-Mart's first New York fashion show. The Bentonville, Ark., company even has a trend-spotting outpost now in the U.S. fashion capital.
Wal-Mart has created a store prototype with wider aisles, lower shelves and more elegant displays of pricey products. The retailer once prided itself on selling the first DVD player under $100. Now it also offers 42-inch flat-panel plasma TVs for $1,648 to $1,998.
It sounds like they're trying to become more like that other retailer. You know the one with the red circles:
But Wal-Mart needs to shake things up. Its sales at stores open at least a year, a key measure of retailing performance, have been lagging. Over the past year, such sales at more fashionable Target Corp. have been rising twice as fast as those at Wal-Mart. Wal-Mart's share price, which hit a 52-week low yesterday, is down 17% in the past year, while Target's has risen 18%.
Wal-Mart more like Target? Somewhere in the wine country of California, JB's mighty heart is breaking (for the second time this week). Oh well, there's always K-Mart.
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