Walmart (WMT) is putting on its best face to try and attract value and well-heeled shoppers away from Amazon (AMZN) and boost its beauty sales.
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Vinima Shekhar, the company’s vice president of beauty, wants the retail giant, perhaps known more for value than glamour, to be seen as a premium beauty retail destination. However, its stock was down 0.5% in early trading.
Discerning Customers
She wants to capture more of those value customers who are “growing more discerning in their cosmetics and personal care purchases and new ones who might otherwise head to Sephora or browse online.”
As can be seen below, beauty, which is part of general merchandise, has been on the decline over the last few years.
According to an article in BoF, Shekhar has already made strides to change that by ramping up its online marketplace, increasing the number of exclusive brands available, collaborating with celebrities such as Sabrina Carpenter and ensuring quicker delivery times.
“The Walmart beauty customer reflects America. We’ve got every demographic represented in our customer cohort,” she said. “71% of our beauty shoppers are women. Of our customers that are below the age of 40, 66% are shopping beauty at Walmart, and we know that these customers are continuing to grow and spend on beauty. Those customers under 40 and earning over $100,000 are actually our fastest-growing cohorts. Our assortment is resonating with these high-growth customers.”
Store Advantage
Its most competitive advantage over rivals such as Amazon is being able to serve the beauty customer online and in-store.
“You want to touch, you want to see, you want to feel, and so we have that across 4,600 stores in the U.S. We also know that the customer wants to shop online, so we’ve got our Walmart.com, whether it’s desktop or app, and through that, they can pick it up,” she said. “On the way home from work, I can just drive by a Walmart, pick up my groceries, and oh, by the way, let me add in my skincare products. I can get them shipped to [my] home or have express delivery.”
The company also has a ‘Store of the Future’ in about a hundred stores where it has positioned beauty adjacent to fashion at the front of the store.
“As far as online, we’ve continued to elevate our digital experience with incredible brand shops and elevated visuals. We know beauty is a lot about storytelling, and the customer wants to be inspired, they want to feel trusted, and they want to feel excited,” she said.
Is WMT a Good Stock to Buy Now?
On TipRanks, WMT has a Strong Buy consensus based on 28 Buy ratings. Its highest price target is $120. WMT stock’s consensus price target is $111.33, implying a 14.15% upside.
