OpenBrand

Retail Landscapes: Walmart vs Target

When I think about current events and the changing landscape of retail, I pause to consider two of the undisputed leaders in American retail: Target and Walmart. While I continue to work from home during these much-maligned unprecedented times, I have given a lot of thought to how these retailers are adapting as well. That is most likely a result of me reinvesting in our home space to accommodate two adults and three kids—all of whom need their own dedicated spaces for work, school, entertainment, and more. I miss milling about brick and mortar stores like Target and Walmart looking for all the things I need (and all the things I didn’t know I needed until I saw them in the store). But I have found a way to support retailers and meet my family’s needs all while responsibly social distancing.

My shopping has focused on three key categories that both Walmart and Target share: Consumer Electronics (CE), Home Furnishings, and Small Appliances. All three categories have played a vital role in sustaining our family’s quality of life during quarantine. The acceleration of curbside pickup means that I have made countless online orders over the last several months that gave me the freedom to arrive onsite and receive my goods without ever leaving my car. Walmart and Target have had to think fast on their feet to forge new paths to meet consumers’ needs. Read on to find out how they stack up against each other in these competitive categories.

CONSUMER ELECTRONICS

Walmart’s dominance over Target is uncontested given their share difference – Walmart’s market share is nearly five times that of Target’s in consumer electronics.  Walmart’s share continues to increase, boasting gains in 5 out of the last 6 quarters. The brand mixes for both retailers has two brands that share the top three spots for each: Samsung and Sony. Sony wins the highest dollar share for Target and comes in second for Walmart; Samsung leads the brand mix for Walmart and takes second place for Target. In addition to selling significantly more Sony branded CE products than Walmart, Target also sells significantly more Apple and Nintendo. When looking at CE purchases made online, Nintendo jumps to the number one brand for Target, significantly outselling Walmart. Samsung maintains its lead position for dollar share at Walmart regardless of whether the purchase was made online or in store. Other than myself, just who has been shopping for Consumer Electronics at these two retailers? Here are a few key differences:

• Walmart shoppers are more likely to have only finished high school compared to the national average (That said, they also over index on shoppers with some college degree or having completed an Associate’s Degree).
• Retirees are more likely to shop for CE at Walmart than they are at Target, but Target attracts more student shoppers.
• Walmart over indexes with CE shoppers whose annual income is $49,999 or less, Target over indexes with shoppers whose annual income is between $50,000-$124,999.

HOME FURNISHINGS

Walmart’s share in Home Furnishings is roughly double that of Target. However, despite the strong unit share, each retailers’ overall share of consumer dollars spent is low, likely due to the affordably priced selection carried by both retailers. However, despite my significant contributions to Target and Walmart’s revenue, Target had a significant decline in units versus a year ago, while Walmart’s dollar share remained steady with year-over-year growth for the third consecutive quarter in a row.

Due to the large volume of import and private label brands, it is difficult to get a read on top brands for Home Furnishings. Home Furnishings do provide one of the greatest benefits of milling around either retailer as you (okay, I) grab those Home Furnishing impulse items. Every. Single. Time. However, when we do break down some of the brand data, nearly half of those purchasing Home Furnishings at Target classified those purchases under Target, Room Essentials, and Threshold—the latter two brands being strong proprietary brands for Target.  There are differences between Walmart and Target Home Furnishing shoppers - here’s a quick overview of the main differences:

• Shoppers are mostly making smaller purchases—most of both Target and Walmart’s Home Furnishing purchases are $44 or less.
• While about half of their home furnishings shoppers own their home, both retailers perform better than the industry average among renters.
• While both Target and Walmart appeal to Millennials and Gen Z, Walmart also over indexes with Gen X shoppers. Target’s highest demographic is Millennials, by quite a lot.

SMALL APPLIANCES

Walmart tends to be consumers’ go-to for the Small Appliance category, compared to Target, despite a significant drop in share for the current quarter versus a year ago. However, a closer view of Walmart’s performance over the last year and a half shows Small Appliances increasing its dollar share in 3 out of 6 quarters. Walmart manages to hold slightly more than a third of the share as Target settles in around 8 percent for overall dollar share. Nevertheless, Target’s performance is holding steady for the category, with the ongoing national crisis having little impact on the current quarter.

Online shopping is front and center for retailers across the country, therefore it is important to understand category performance among those buying Small Appliances online as well. Walmart’s online only share for the category is almost 3 times Target’s share- 14 percent versus 5 percent for the last year. Interestingly, when drilling down to the product level, both retailers have the same top 3 Small Appliances sold online (and in-store, for that matter): Microwaves, Full Size Vacuums, and Coffee Makers. However, each retailer seems to have their sweet spot: Target sells significantly more Coffee Makers - both online and in-store, while Walmart sells significantly more Microwaves.

The brand mix for these two retailers is also different, with Walmart selling significantly more Bissel, Hamilton Beach, Hoover, and GE. The brands that make significant inroads at Target are slightly higher-end, and include Keurig, KitchenAid, Dyson, and SharkNinja. As with our other categories, here is a look at the differences in consumers buying these appliances at Target and Walmart:

• Shoppers at both Target and Walmart are more likely to spend $89 or under for Small Appliance products. That said, consumers at Target are more likely to be spending $150+ at Target than they are at Walmart
• Target again over indexes on Small Appliance shoppers with a college degree or some level of post-grad. Walmart over indexes for all other levels of education, but especially in high school graduates and some college.
• Walmart over indexes with homemakers for Small Appliances, while Target over indexes with students, similar to how shopper demographics break down with Home Furnishings.

KEY DIFFERENCES IN DEMOGRAPHICS: TARGET VS. WALMART:

Many argue that these two retail leaders do not attract the same core consumers. In fact, even Walmart’s CEO is calling for his store to attract an expanded customer base by shifting their focus from lower income to higher income customers, who not only spend more, but expect more as well. Does Target have the customers they are looking for?

Overall, Walmart does draw in more customers than Target. And frequently, those customers are looking to spend similar amounts on goods and services. One thing Walmart could lean into more is the sheer volume of Walmart stores across the country versus Target. Target serves primarily urban/major metro area consumers—Walmart does a much better job reaching consumers who live in rural parts of the country.  A key advantage that Target has is its ability to attract students. Building loyalty in student shoppers, may translate to shopper loyalty for Target once they’ve finished school.

One additional note of interest: when comparing the online sales between both retailers, Target made significantly more of their sales online than Walmart did across all three categories for the last year. While not as substantial as the quantity of in-store sales, online shopping does fit with the younger, chic, urban, and trendy profile that many believe to be the primary Target shopper. While Walmart does have the higher overall volume of sales, Target seems to do a better job catering to shoppers who prefer an online experience.

by OpenBrand

How To Design An Effective Mobile Survey

From in-person, to paper and pencil, to online, those of us who have been in the market research industry for years have seen big changes in how surveys are administered. As Bob Dylan once sang, “for the times they are a changing”- but I beg to differ. The times have changed already. The newest change in administering surveys? Making those surveys mobile friendly.

Here are a few tips for ensuring that your survey is optimized for being taken on mobile devices:

“Brevity is the soul of wit” – Watch Your Length

Mobile devices (phones, tablets, etc.) typically have smaller screens than a traditional desktop computer. As a result, online surveys that seem quick and easy to complete on a desktop can become long and arduous on a mobile device. As “brevity is the soul of wit”, you will want to apply the principles of brevity to both the length of your interview (as in the number of questions asked) as well as the length of the questions themselves. It’s a good idea to keep question wording as direct as possible. As an example, instead of asking “What is your gender?”, you can simply ask “Gender?” with the appropriate multiple-choice responses.

Survey Layout

Certain types of questions that look great on a PC or laptop may not look quite so nice on a phone or tablet. For example, large “grid” type questions with multiple scale choices and lots of attributes to rate on that scale should be recalibrated to fit on mobile screens. Either reduce the number of attributes to rate, or at the very least break them up onto multiple screens. Lots of scrolling down in a mobile survey can be frustrating.

Similarly, questions that require a large text box (i.e. open-ended questions) should be used sparingly on mobile interviews. Typing on a small mobile keyboard is problematic, and as with a large “grid” question, the respondent may have to scroll. Keep text boxes manageable. Also, consider an audio option for collecting open ended responses. Instead of typing their answers, respondents can simply speak their answer into their device’s microphone. This is faster and less likely to contain errors. While this option may not always be feasible, it should at least be explored.

“Make it simple, but significant”- Consider several survey sections

Bite-sized survey sections may be best. That is, break the survey into smaller pieces with a very short intro that has the respondent focus on a particular topic (i.e. where did you purchase and why). As Mad Men has taught us, “keep it simple, but significant.” Having distinct sections of the survey could help keep mobile respondents more engaged and help with overall participation incidence.

One of these things is not like the other – test your survey on multiple devices

As Sesame Street has taught generations of children, “One of these things is not like the other”. Due to the variance between screen sizes and operating systems among mobile devices, different devices will display your survey differently. The upshot is that it is important to test your survey on multiple devices- from desktops, tablets, and phones, as well as across multiple browsers and operating systems.

Additionally, images may not be displayed the same way on different devices. If you need to show images in your survey, a good idea is to have a thumbnail (or small image) that expands into a full-screen image when clicked upon. That way the text and thumbnail can be shown together, but the option of more image detail is available as needed.

Don’t ask unnecessary questions

Chances are you are conducting your survey through a panel provider. If so, do you really need to include questions about the demographics you are interested in tracking? Most of the major panel providers have recent demographic info on their panel participants. You may be able to append this data without having to ask these questions in your survey. This goes back to the survey length concern mentioned earlier.

The ubiquity of mobile phones as peoples’ primary way to access the internet means that for conducting good research, a mobile-friendly survey isn’t just a “nice to have”, it’s a “critical to have” component. Following best practices like those we’ve outlined here, as well as general best practices when designing and testing your survey will help ensure that you get quality, actionable data from your research. Working with experienced teams like the research group at The Stevenson Company will help you align your survey for the best results possible.

by OpenBrand