It's about the real economy now
Wal Mart was always a down market retailer. I feel at home in Target - wide, brightly lit isles, a good collection of kids clothes. I don't at Wal Mart.
The average household income of people who shop at WalMart and not Target is above what I lived on as a student, but below the income of my (mostly part-time-employed) student household.
Three years ago Jeff Matthews commented on the difference by saying WalMart had "Target Envy". This reflected income demographics in the US - where the squeeze was already on lower income households (oil etc) and the middle income demographics were doing middling to OK.
Target envy might be a thing of the past - but it is clearly getting worse in Wal Mart's demographic. Paul Kederosky talks about things that WalMart is now seeing.
Wal Mart has always had a pay-check related shopping spike - with a substantial number of customers living (as I did when a student) from pay stubb to pay stubb.
But for the first time they are having pay-check driven spikes in the sales of baby formula suggesting the economic pressure is more widespread.
It is about the real economy now.
John Hempton