Target is unique in that it’s popular with a certain higher-echelon shopper, while also being a big-box discounter.
And true to that dichotomy, management tells Citi’s Deborah L Weinswig that the high end is doing well, and the low end is doing badly.
Economy Recovery is Uneven – Management noted that the economic recovery that is occurring has been uneven for consumers depending on their household income. While spending by the upper tiers of TGT’s customer base is quite healthy and is being reinforced by the 5% Rewards program (which increases frequency), customers with more moderate incomes who used to purchase consumables at WMT and splurge on discretionary items at TGT have tempered their discretionary spending.
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