In an effort to boost sluggish sales, Wal-Mart Stores Inc. has abandoned its one-size-fits-all approach to retailing where all stores stock nearly the same inventory, regardless of location, in favor of tailoring the inventory to fit the customer base in the immediate area surrounding the store. The Wall Street Journal reports that Wal-Mart stores will be customizing their inventory in each store to better appeal to six distinct groups they are targeting - African-Americans, Hispanics, suburbanites, rural residents, empty-nesters, and the affluent.
Wal-Mart is hoping to give a boost to lagging same-store sales. In 2005, the company grew same-store sales at 3%, compared to 9% in 1999. Target, a major competitor, grew same-store sales at 6% in 2005, and has consistently bested Wal-Mart's numbers in 2006.
WSJ.com
MSN Money
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I'm not a big shopper, so I rarely have an opportunity to go into a Target store, but I have been impressed by the improvements they have made in terms of selection and display over the past several years. At one point, in my mind at least, Target was sort of a nondescript also-ran to Wal-Mart. They have differentiated themselves by becoming trendier and more relevant to today's, as Kyla puts it, educated middle class consumer. The same store sales growth of Target, which stands at 6% for 2005, is impressive, but in more of a relative sense. If Wal-Mart were back to the good old days of 9% same store sales growth, 6% would not look so good. Just my opinion, but I don't believe we will see Wal-Mart returning to those glory days any time soon.
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