The manifest expansion of our retail landscape has engendered some of the grossest dichotomies of the American mind: the sacred cow of free enterprise versus the bygone idyll of the corner store; the yen for cheap-and-easy versus the instinct to defend the community; the gee-whiz anticipation of the local big-box store opening versus the decaying town center. Wal-Mart, of course, has been the aircraft carrier of the retail sprawl, around which ever more strip malls crop up, siphoning dollars from local economies and sending them off to distant headquarters. Wal-Mart, the biggest retailer in the world, is the single largest employer in the U.S. (a staff of 1.4 million) â€” it's America's proxy downtown, grocery store, video store, hair salon, electronics store, hardware store, flower shop, ad infinitum.
That's a tough customer. The unions have found that out. So have local communities, beset by lobbyists and lawyers whenever protectionist troublemakers attempt to plant their feet in front of proposed Wal-Mart sites. Kmart found its point of difference, its offerings and services winnowing so much in recent years that it filed for bankruptcy in late 2001. On the flip side, there's Target, which seems to have done what so many other erstwhile competitors have failed to do, growing both its footprint and its per-store sales while operating essentially the same kind of business as the Bentonville, Ark., behemoth.
Curiously, the mass merchandise chain, long centered in the Midwest, has done this by means one would not really expect from a big store basically offering cheap goods across myriad categories â€” again, think Kmart â€” that is, through stunning, avant-garde image advertising, both for itself and its vendors. Its recent hookup with designer Todd Oldham serves as just another step up in concept for the company, as it stakes out a distinct position as the stylish choice, the hip repository of brand-name products for a younger generation of shoppers.
Think Martha Stewart for Kmart. Now make the endorser less relevant to middle-aged homemakers and shift him/her toward the left of the culture, where it's less about bourgeois notions of environmental conformity, more about self-expressive art. Now set him/her amid what has become the trademark, thickly artsy, polychromatic, rock 'n' roll-underpinned TV spots for Target.
In recent years, Target's spectacular co-op advertising in this vein has put profoundly younger frames on such vendors' brands as Tide and Coca-Cola, the latest example being the guitar-ripped, red-on-black, slash-animated plug for Slim Jim. When the ad first blares at you from the TV set, you wonder just what this company is trying to do that it has taken such an eye-grabbing tack to hawk its wares. Then the red Target logo appears. Oldham, bringing his proprietary designs for clothing and home furnishings â€” back to college, kids â€” builds this aesthetic on the fashion end of Target's business with a kind of street cred that Stewart could never claim.
Not that it's unprecedented. The company, which declined to comment for this story, has put a sort of daringly outrÃ© twist on the celeb sub-brand model established by Kmart with its pioneering, if humdrum, Jaclyn Smith collection in the 1980s. Target has linked with designers found on a down cycle of the bizarre fashion roller coaster â€” Mossimo, for example â€” to give a post-ironic bump to its fashion section. The company even executed a quirky product design coup, wooing architect and professor Michael Graves to design a set of distinctive home furnishings and appliances.
Such associations have garnered the chain a sort of mass-merchandising â€œItâ€? status, even among the more moneyed consumers one might expect to shop in more elite environs. â€œItâ€? status, of course, is an ephemeral thing, but combine this with the distinct kaleidoscope and spirited voice Target has developed with its co-op advertising, as the Oldham introduction does, and you've got a brand image moshing well beyond its volume-buying discount store roots.
â€œTo their credit, they have been able to sustain a brand and a business in the face of just huge competitive pressures from Wal-Mart, and that's really about the fact that they have built this trendy sort of aesthetic,â€? says Wendy Liebman, president of WSL Strategic Retail, a New York consultancy. â€œDiscounters per se have to some degree developed a sort of Baby Boomer chic, where people you might consider a designer buyer might go into their stores for â€˜an adventureâ€™ and find some great deal. But Target has it more than anyone.â€?
In spite of Wal-Mart's sheer volume and town-by-town penetration â€” last year's sales were some $220 billion, versus Target's meager $40 billion â€” the numbers do show some curious, if subtle, curves when it comes to Target. In a poll conducted by CNN/USA Today/Gallup in January, 1,011 adults were given a choice of Kmart, Wal-Mart and Target. Consumers who prefer Target do so on a sliding scale upward, depending on their income. Only 16 percent of those with incomes of $20,000 or less choose Target, but that climbs to 23 percent for those with incomes of $20,000 to $29,000, 26 percent for those earning $30,000 to $39,000, 29 percent for $40,000 to $74,000 and 47 percent among those with annual earnings of $75,000 or more. An expectedly proportionate curve applies to education levels. Wal-Mart preferences cycle the other way, with 59 percent of those making less than $20,000 and just 41 percent of those making $75,000 or more preferring Wal-Mart.
For masters of the obvious, Wal-Mart's low prices for the most part explain its popularity. But we also see some of Target's deftly nurtured cred bearing fruit with a distinct set of consumers. Among the more fashion-inclined female subset, for example, 33 percent prefer Target, compared with 22 percent of men, who find more lure in Wal-Mart's hardware, home and sportsman's sections (to the tune of 58 percent, along with 47 percent of women).
And while all age groups choose Wal-Mart, at around a dominant 50 percent rate, note how Target's â€œedgeâ€? has built more affinity with the younger group: 33 percent of people age 18 to 29 prefer the store, as do 33 percent of those 30 to 49, 26 percent of those 50 to 64 and just 18 percent of those 65 or older. Moreover, if we factor out older females, those over 50, Target's affinity with women climbs to 41 percent, a much narrower gap with Wal-Mart's 47 percent. Indeed, among the 18- to-49 age group, males selecting Target even climb a couple points, to 24 percent.
So to some degree, even as Target grows its same-store sales 4 percent to 6 percent a year â€” over a three-year period of recession â€” it is doing so while seeding its brand with a younger audience, one more inclined toward its bolder design cues and its more offbeat, more culturally salient marketing attack.
Of course, none of this negates the sheer weight and horsepower of the Wal-Mart steamroller and its impact on lesser species of retailer. Its expanded Wal-Mart Supercenters have put the company in direct competition with full-service supermarkets, whereas Target just hawks the commodity packaged goods of its vendors in slick ways.
But while Wal-Mart continues to be all things to most people, a regular stop to and from work, generally more ubiquitous and striving toward omnipresence, Target has made its bones by staking out a unique spot in the mind of its own consumer subset. If nothing else, it's that all-important brand position the marketing gurus talk about.
The company, from its homespun origins, has â€œedgedâ€? its way to an intriguing medium, somewhere between Old Navy and Ikea, Urban Outfitters and 7-Eleven. It's ensured, at least for the moment, that two stores will remain standing when the dust clears from a retail-engulfed marketplace.