We may soon be shopping at Big W more

You may have heard or read about Kmart and Target’s merger – Kmart CEO Guy Russo has taken over Target,
Australia

You may have heard or read about Kmart and Target’s merger – Kmart CEO Guy Russo has taken over Target, however they face an issue that could do the opposite of what they aim to do… turn shoppers away.

Last month the former McDonald’s chief admitted he didn’t know how he would differentiate the two brands from each other. This could work against the savvy businessman, meaning confused shoppers could go to the ailing Big W instead.

Wesfarmers has been warned that merging the two stores could cost them hundreds of millions of dollars by Bank of America Merrill Lynch retail analyst David Errington.

He has described the merging of two fierce competitors as “highly problematic” and could cost the company sales and earnings, reports Brisbane Times.

Wesfarmers is underestimating how loyal Target shoppers were to the brand and was not appreciating the stark differences between the two chains and the customers that shop there.

“As we see it, the biggest winner from this merger could be Big W where disillusioned Target customers could migrate to,” Mr Errington wrote in a research note.

“This will be the biggest area for sales and earnings leakage”.

In terms of similarities between the three discount department stores, Mr Errington said Target was more like Big W than Kmart, and thinks a conversion of Target stores to Kmarts could mean frustration for shoppers who enjoy their local Target.

Despite this advice there’s no arguing with the figures: Target’s earnings have fallen 70 per cent in the past five years and something needs to be done, after a brand rehaul didn’t help their cause.

And even though Kmart has seen a huge profit increase since Guy Russo took over, Mr Errington said Kmart’s earnings would be $25 million lower next year and $30 million lower in 2018 because of the merger.

What was even more puzzling and dividing for customer was that Target and Kmart had spent six years trying to differentiate themselves and competed fiercely, said Mr Errington, meaning a merger would create chaos.

“We are skeptical toward Target and Kmart being able to share joint services,” he wrote. He even suggested that Kmart had done so well because they were able to step on Target as their sales soared. A merger could mean, at the very least, profits would be more evenly spread, not increase.

Tell us, which shop do you prefer? Kmart, Target or Big W? Would you mind if you local store changed into a Kmart or Target?

 

  1. KMART STUFF IS DEFINATELY A BIT CHEAP AND NASTY. I SUPPOSE IF THEY COULD COME TO SOME MIDDLE GROUND WITH QUALITY AND PRICES IT MIGHT BE A GOOD THING. I CAN’T SEE THEM DOING THIS BECAUSE THEY ARE TOO GREEDY. BIGW ARE SOSO.

  2. Paula Hibbert  

    I do not like Kmart as I find their stores in S Aust to be shopper unfriendly and they have very cheap and nasty goods. I prefer Big W. They have reasonable priced merchandise which I find is of better quality. Although I like shopping at Target I have found their prices have increased quite a lot over the last few years. Out of the 3 of them Big W is my preferred store, but they are not conveniently located for me now.

  3. Ray  

    Kmart clothing falls apart and when you complain they dontcare if target follow Kmart big w here i come

  4. Joanne Urbanowicz  

    I like Target for quality in things like clothing,homewares,toys are more expensive in Target,then Kmart even though same item,I seem to shop more over all in Kmart now though after the revamp,why can’t they keep they way it is but lower prices a bit or offer more deals if you spend so much

  5. Carole  

    I would definitely shop more at Big W if it was in my local west field shopping center. It’s just not convenient, too far to travel. There is a kmart and target local, I prefer Target as Kmart stock is rubbish.

  6. Barbara Finch  

    I love TARGET, the quality of their clothing is much more superior to Kmart, where the clothing isnt very good quality.
    I wouldnt move to BigW as they are not a shop i go to much anyway and they are not at Parramatta.
    Target has been my favourite shop for EVERYTHING since it opened, i love it, i love the people that work there and i love walking around the store to find specials and new clothing labels, just bought the JPG clothing anc love it, so please dont take Target away, i love it, my friends and family love it too.

  7. Melanie  

    I prefer Target anytime to KMart. I do shop at both but I would say 90% of the time I always get what I need at Target.The quality at Target is a lot better

  8. christine troy  

    I LIKE kmart better than tsrget, also big w but not one close enough

  9. I shop at all three stores, I think Target is better for quality, k-mart good for children’s clothes but for a special occasion then Target. I find Big W vary in their quality, I have had good and bad buys, but I like them for dvd’s and books and some homewares. I think it would be a mistake to merge.

  10. marilyn  

    I love Big W, items are competitively priced, baby goods, electrical and clothing. Target I shop at for the larger men’s clothing range. The quality of all clothes is good at Target. Kmart more for electrical goods. Different stores for different things, whichever does it better, quality and price wise.

  11. I had been an avid Target and Kmart shopper for many, many years. Kmart changed to cheap and nasty and boring clothing especially and they lost me forever. Don’t go into their stores anymore. Now they have their claws into Target. If they go down the same road with Target, then they have lost me again. Living in regional areas, we rely on stores who can provide quality clothing at an reasonable price. I won’t pay my hard earned money for goods that fall apart after a few washes. I always buy quality and am happy to do so. Target, get it right or you will lose many shoppers.

  12. I had been an avid Target and Kmart shopper for many, many years. Kmart changed to cheap and nasty and boring clothing especially and they lost me forever. Don’t go into their stores anymore. Now they have their claws into Target. If they go down the same road with Target, then they have lost me again. Living in regional areas, we rely on stores who can provide quality clothing at an reasonable price. I won’t pay my hard earned money for goods that fall apart after a few washes. I always buy quality and am happy to do so. Target, get it right or you will lose many shoppers.

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