Target has implemented its core strategy to poach customers from Walmart, and according to Inc., it boils down to a four-word approach.
The underlying promise is the strategy of “expect more, pay less.” This tagline draws customers into the store and makes them believe they can get the products they need at a good deal and at a low price.
“We've reduced prices on 5,000 products,” Target CEO Brian Cornell said, as reported by TheStreet, “but value is in our DNA. If you go back to our brand promise, 'expect high, pay low,' and that's what we do every day,” adding, “This is a no-cost business and it's a very competitive space, but we're delivering the value consumers want.”
“We know consumers feel pressured to get the most out of their budgets, and Target is here to help them save,” Target said in a corporate press release, adding that Rick Gomez, executive vice president and chief food, staples and beauty officer at Target, “Our teams work hard every day to offer great value, and these new price reductions on thousands of items mean even bigger savings for the millions of consumers who shop at Target every week for everyday essentials.”
Cornell's comments came after the supermarket announced price cuts on 5,000 commonly purchased items this summer. He said of the decision, “We've been very pleased with the consumer response to our price investment in 5,000 commonly purchased items, but this is more than an investment.”
“If you're a Target Circle member, you'll receive personalized offers every time you shop, and if you use your Target Circle card, you'll have the opportunity to receive 5 percent off,” he added.
In comparison, Walmart's tagline is “Everyday Low Prices.” EatingWell reports that Walmart President and CEO Doug McMillon explained that “when it comes to value, we're lowering prices” during Walmart's second-quarter earnings call on August 15. McMillon explained that the company had made 7,200 price cuts internally, piggybacking on a claim made by the company in February that “overall, food prices were lower than a year ago for items like eggs, apples and deli snacks, but higher for items like asparagus and blackberries.”
According to Inc., both Target and Walmart are known for competing on price, but the difference is that Target “also offers a different experience. That's where the 'expect more' part comes into play.”