The Real Reason Target Is Failing While Walmart Prospers

Core Insights - Target is struggling due to a loss of its original brand identity and principles, contrasting with Walmart's successful adherence to its foundational values [4][10] - The introduction of grocery sections in Target stores marked a significant deviation from its original discount fashion focus, leading to operational challenges [5][6] - Walmart has successfully built its grocery business, which now constitutes nearly 60% of its projected 2025 revenue, while maintaining its core discount merchandise strategy [8] Company History and Brand Identity - Target was founded in 1962 by Douglas Dayton, aiming to merge fashion with discount retailing, symbolized by its logo representing quality and value [4] - The brand was once perceived as chic and affordable, earning the nickname "Tar-jay" in the 1990s, indicating its successful positioning in the market [5] Strategic Decisions and Market Position - The decision to add grocery sections to compete with Walmart led Target to stray from its core competencies, as it lacked experience in the low-margin food business [6] - In contrast, Walmart has consistently focused on its core discount model while expanding its grocery offerings, which has driven significant foot traffic and sales [7][8] Leadership and Ownership Influence - Walmart's continued success is partly attributed to the influence of the Walton family, who maintain a significant ownership stake and uphold the company's founding principles [8][10] - Target, on the other hand, is primarily held by institutional investors, lacking direct influence from the founding family, which may contribute to its brand dilution [10]