Wal-Mart vs. Target

As consumers shift their spending habits in the face of economic uncertainty, there may be a resurgence for Wal-Mart and its everyday low price strategy, and that may have ill-effects at Target.

A discussion group on RetailWire (registration required) alludes to that, and I'll post some of the responses below.

"There are so many reasons and possibilities for why Wal-Mart does better than Target in a sluggish economy but for one, the Target consumer tends to be a young trendy consumer that might have less individual spending power or disposable income right now at this present time." - David Biernbaum, David Beirnbaum Associates.

"Wal-Mart has an inherent advantage in tough economic times--Supercenters! These one-stop shops in a large portion of the US give shoppers the opportunity to buy food for home economically and also reinforce the low prices on apparel and hard goods. One-stop also means less gas to buy. Target is not positioned to do this except in a limited area where Super Targets exist. Target should consider a change in its advertising strategy to move from subliminal suggestion to a more hard sell, featuring price and variety to survive the current economic climate." - J. Peter Deeb, Deeb and MacDonald Associates

"I love this! For years Wal-Mart has been drooling after Target's customers and straying from their brand positioning with often disastrous results. Now Wal-Mart has found its way back to EDLP and the core values that its customers count on at the same time economic downturn favors its approach. Great timing for Wal-Mart and lucky for them they're not sitting on more skinny jeans in this climate. I liked the comment about assortment--it's true, Target truly curates the assortment (number of brands and numbers of sizes) available to consumers and I think they may find they have been overly selective. Consumers like choice--they'll sacrifice it for a great deal (hello, Costco!) but Target now has the problem of not being as upscale as Costco nor as cost conscious as Wal-Mart. Target has several problems to address: they don't move the same volumes as Wal-Mart, they don't have the same operational efficiency and yet they want to be priced competitively." - Lisa Bradner, Forrester Research

What do you think? Most of the above comments relate to general merchandise. Is Wal-Mart positioned to rise above other food retailers in these tougher times?