February 09, 2010
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Zogby Interactive: Target Close Behind Wal-Mart As Top Store Choice
Demographic Study Shows Who Shops Where
UTICA, NY - A Zogby Interactive survey found Wal-Mart at 26% and Target at 22% as the stores voters would choose if they could only shop at one store for the rest of their lives. The study provides insight about the shopper demographics of major department store retailers, who were battered by a sub-par holiday shopping season.
For several years, we have asked voters what department store they would prefer to shop at if they could only shop at that store for the rest of their lives. Our most recent test of this came in a Zogby Interactive poll of 24,964 voters conducted from Nov. 7-18, 2008. The margin of error for the entire sample is +/-0.6, Here is how the stores we tested ranked:
1. Wal-Mart 26%
2. Target 22%
3. Macy's 9%
4. Costco 8%
5. Sears, JC Penney & Kohl's all 5%
Also measured were: Neiman-Marcus and Bloomingdale's at 2%, Marshalls at 1% and Boscov's, Filene's and Kaufmann's all under 1%.
As has been reported, retail sales dropped 2.7% last month, more than double the 1.2% Wall Street expected. Even Wal-Mart, the king of retail, did worse than anticipated. According to data compiled by Retailer Daily, Wal-Mart saw only a 1.9% increase in same store sales for December this year compared to last. Also on the plus side was Costco at 2.0%. The same data found December decreases in same store sales from a year ago for these retailers: JC Penney --8.1%, Sears -- 7.3%, Target -- 4.1%, Macy's -- 4.0% and Kohl's -- 1.4%
Our survey provided detailed demographic information about each store's most loyal shoppers. Because of sample size, we'll profile the top seven. Sample sizes and margins of error for these rank from Wal-Mart at 6,473 (+/-1.2%) to Kohl's at 1,214 (+/-3.0%).
Wal-Mart: Low prices are its main appeal, and the incomes of shoppers who prefer Wal-Mart do skew somewhat toward the low end. Forty-three percent have household incomes below $50,000, compared to 34% of the entire sample. They are also less likely to be college graduates, (33%, compared to 45% of the entire sample). The company still does most of its business in the South (33%) and Midwest (32%), with 18% each coming from the West and East coasts. Wal-Mart has moved away from being just a small town hit, as similar numbers of these shoppers are residents of large and small cities, suburbs and rural America. These shoppers who most favor Wal-Mart remain politically conservative, with 58% of these voters favoring John McCain. Also, 35% identify themselves as Born-Again Christians. That doesn't make these Wal-Mart shoppers older than the norm, as the age distribution we found is very much in line with all shoppers. They are less likely to travel outside the U.S., as only 37% have valid passports, which is 14 points less than the entire sample. They are also only slightly more likely to own a gun than those shoppers who favor other stores.
Wal-Mart may have had a disappointing holiday, but given its low prices and the national economic hard times, Wal-Mart should continue to be just fine.
Target: This retailer's demographics are much simpler to detail. Shoppers who would choose Target above other stores are more likely to be younger (29% are 18 to 29), better educated (54% have a college degree), urban (39%), and female (61%) -- all positive demographics for a retailer. These Target shoppers are also more liberal (63% voted for Obama). Beyond those measures, Target hits all demographics in line with the population.
Like other retailers, Target suffered during the holiday season. However, the company is attracting the right customers to remain near the top in consumer popularity.
Macy's: Three-fourths of shoppers who are most drawn to Macy's are urban or suburban, so it follows that they are liberal (63% supported Obama), wealthier (38% have a household income of more than $100,000 and 55% own homes worth more than $250,000) and college educated (53%). It's no surprise that 66% are women.
On Jan. 8, Macy's announced it was closing 11 underperforming stores, saying its long-term strategy is to continue to selectively add new stores while closing those that are underachieving. On Jan. 15, Fortune reported that Macy's may further restructure operations in a move to cuts millions from its costs. Consolidating its markets could help Macy's better focus on its upscale, urban clientele.
Costco: Fifty percent of shoppers with a strong preference for Costco live in the Western U.S. In that region, Costco approaches Wal-Mart in the numbers who choose it as their favorite. As a warehouse club, it competes directly with Wal-Mart's Sam's Club. However, there are some clear differences between shoppers who prefer Costco over Wal-Mart. Costco shoppers are more liberal (56% voted for Obama), travelers (65% have valid passports) and wealthier (54% own homes worth more than $250,000, and 37% have household incomes above $100,000).
Costco is the Wal-Mart alternative for Democrats, and that is a good place to be. The company is talking about expanding.
Sears: Sears' standing is reflected in its demographics. Shoppers who favor Sears are older (47% are 55-plus, 13 points higher than the whole sample) and more likely to be male (72%). They are also gun owners (53%, 19 points more than the sample), more conservative (56% voted for John McCain) and homeowners (84%, 10 points above sample).
Sears has defied the expectations of many, and, for now, doesn't look like a company on the verge of demise. In a time when money is tight, consumers aren't looking for the fancy. They want utility, and Plain Jane retailer Sears is looking better.
JC Penney: This retailer most strongly appeals to women (66%) and people 55 or older (47%). Obama received 56% of JC Penney shoppers' votes.
Despite declining sales, JC Penney says it does not expect to close any stores this year. According to reports, the company is focusing on buying less up front and responding quickly to trends.
Kohl's: Most of the company's shoppers are in the Central/Great Lakes region, and their demographics are pure Middle America. Differences with the overall population are not significant. Sixty-one percent are women. They preferred McCain over Obama 51%-49%.
Kohl's broad-based clientele should bode well, as reflected in its minimal December sales decline.
http://www.zogby.com/methodology/readmeth.cfm?ID=1385
(1/22/2009)
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