Kantar Retail: Target narrows Walmart’s basket advantage
Boston — Although Target has narrowed Walmart’s basket advantage, the world’s largest retailer continues to demonstrate its price advantage, according to Kantar Retail’s semi-annual pricing study.
With an overall branded basket 2.4% less expensive than Target’s, Walmart’s overall price gap has still remained within a few percentage points of Target’s, although its lead has narrowed since the last iteration of the study. Importantly, Target’s edible basket was within cents of Walmart’s.
“Though bolstered by TPCs, Target’s ability to match Walmart’s pricing in a department where Walmart has focused its price leadership efforts is most impressive,” said Robin Sherk, director of retail insights for Kantar Retail and leading contributor to the study.
The tenth iteration of the semi-annual mass channel pricing study determines which retailer’s basket of grocery and consumable items offers shoppers the lowest price. Kantar Retail revisited the same co-located Walmart and Target stores in Northeastern United States in June 2013 to re-assess a previously established basket of national brand items including edible grocery, non-edible grocery, and health & beauty aids (HBA) items. Only identical SKUs from both retailers were assessed.
“The two retailers continue to strategically diverge in how they reach relative basket comparability, with Walmart very much focused on building a strong value proposition through EDLP,” said Sherk. “In contrast, Target selectively relies on temporary discounts to narrow the gap, and then offers guests ways to save even more through loyalty programs such as its REDcard,” she adds.
Highlights of the study include:
- Driven by non-edible grocery, Walmart’s overall branded basket was 2.4% less expensive than Target’s, with only Target’s HBA sub-basket leading Walmart’s in price.
- Walmart’s edible grocery basket was only six cents cheaper than Target’s, practically eliminating its 14.1% lead in January 2013. Target achieved this near comparability through four temporary price cuts (TPCs).
- On an individual item basis, Target’s basket narrowed the spread recorded in January 2013. Only 19% of the items in the two retailers’ baskets were more than 10% more expensive at Target this iteration.
- Target narrowed prices primarily through TPCs. Walmart maintained its lead through everyday low prices (EDLP), with its basket recording only one Rollback. Target increased its use of TPCs to a total of 10, an increase from seven in January 2013.
- With 5% Rewards, Target’s overall basket would have been 2.7% less expensive than Walmart’s. Although Target continues to offer a very competitive basket price to its REDcard holders, the non-edible grocery sub-basket this iteration would still be 3.5% more expensive at Target.
NPD: U.S. Hispanics more likely to purchase groceries at c-stores
Houston — U.S. Hispanics are more likely to purchase grocery foods, dairy, and bread from convenience stores (c-stores) than non-Hispanics, reports the NPD Group, leading global information company. Spanish-dominant Hispanics are more likely to make grocery item purchases at c-stores than other Hispanics, according to the NPD report entitled The C-Store Hispanic Shopper, which examines the typical convenience store shopping behavior of Hispanics by level of acculturation and how it compares to non-Hispanics.
On average, U.S. Hispanics make almost two more visits a month than non-Hispanics to major oil chain convenience stores, and nearly one more visit over a 30-day period to traditional c-stores than non-Hispanics, finds NPD’s convenience store research. For some Hispanics, c-stores supplement or substitute grocery stores.
“As one of the fastest growing U.S. population groups, Hispanics are an important segment for the c-store channel,” said David Portalatin, NPD’s c-store industry analyst. “As this report reveals, having a good range of grocery like items and other staples may increase Hispanic traffic, and promoting fresh foods considered to be more homemade or cooked should resonate well among Hispanics.”
In addition to groceries, over two thirds of Hispanics consider having fresh food available at c-stores to be very/somewhat important. Fresh foods are more likely to be purchased by Hispanics for lunch or breakfast and hot foods are preferred, finds NPD. Sandwiches/wraps are least likely to be purchased by Hispanics.
Sears offers personalized omni-channel coupons
Hoffman Estates, Ill. — Sears is offering personalized digital coupons to members of its Shop Your Way loyalty program that are redeemable in-store, online and from a mobile device. Members can download the virtual coupons, tailored to their interests, style preferences and shopping habits, from the Internet or the Sears mobile app.
The digital coupons are part of a number of special omni-channel offerings Sears provides, which include same-day, free in-store pickup of online purchases, mobile checkout, “endless aisles” online-only product assortment and free home delivery of out-of-stock items.
"No matter how or where our Shop Your Way members choose to shop with us during back-to-school season Sears has a way to do so conveniently, save time and money, and earn rewards," said Ron Boire, executive VP, chief merchandising officer and president, Sears and Kmart Formats. "We are creating experiences that make our Shop Your Way members come back for more – that’s why we expanded our apparel brands and in-store technology to appeal to the individual fashion and shopping styles of our members and customers."