Walmart’s placement in the retail industry is strong because they understand not only what their customers want and need, but also where they want it and how they want to experience it. they are able to use their bargaining power to get quality products. Target’s placement in the retail industry is also strong, but second to Walmart. They are able to positively differentiate themselves from other retailers and provide a compelling value proposition which largely determines their competitive position within the retail industry.
Differentiation and Integration
Walmart’s differentiation strategy is to lead on price, invest to differentiate on access, be competitive on assortment and deliver a great experience. Per the company’s …show more content…
Whereas Target diversified through offering loyalty programs such as REDcard Rewards and Cartwheel. They also took a page from Walmart’s hand book and built more flexible store formats like TargetExpress and CityTarget, which cater to guests in rapidly-growing, dense urban areas. An area they are diversified in are products. They have their owned and exclusive brands such as Up & Up, Ava & Viv, Just One You made by carter's, and Oh Joy! for Target which was approximately one-third of 2016 sales. Target is not trying to be the catalog of everything, said digital chief Mike McNamara. Target says it isn't looking to be a soup-to-nuts retailer. "We aren't going to add products to our website and stores just because they exist." (Safda …show more content…
Although the recent system hack at Target has cost them financially, but they still have a loyal group of consumers. As both companies are main players in the retail industry they share high level of market commonality. Although the strategies are different and they have different target audience, they still offer very similar services such as pharmacy center, apparel & accessories, and discounted products. Walmart no longer has an international presence, so one less company for Walmart to compete with. Despite the size advantage Walmart has over Target, they still have similar resources such as brand recognition, suppliers and human capital. Target focuses largely on product innovation and quality as compared to Walmart’s price strategy. Since both parties share high level of commonality and resource similarity so their awareness of one another is there. If one makes a competitive action the other will consequently respond in kind as experienced when Walmart started building Walmart express, Target followed by opening Target Express and City Target. Furthermore, due to the shared similarities engaging in a rivalry will not benefit either, instead it will affect their respective market positions and allow others to enter into the market easily. In regards to their financial performance, Walmart’s sales revenue decreased by -.07% from 2015 to 2016. While Target