• by Sarah Mahoney  @mahoney_sarah, August 19, 2011

It's not an easy time to be Walmart. First, economic worries are hanging heaviest on lower-income shoppers, its core audience. Next, there's a growing sense among those shoppers that Walmart's "Everyday Low Price" positioning is eroding, and that there are better deals in dollar stores, supermarkets, and even at Target.

For now, shopping at Walmart is cheaper than Target, one of its primary rivals. A just-released pricing study from Kantar Retail shows the Bentonville, Ark.-based chain has regained its edge, with a basket price 1.2% below Target's. But for shoppers using Target's REDcard to purchase items in the basket, the price would have beaten Walmart by 4%. (Previous Kantar research has shown that 14% of Target shoppers do sign up for the card, in order to get the 5% discount.) "Looking ahead, Walmart's EDLP strategy appears set to intensify," writes Leon Nicholas, SVP/insights for Kantar Retail, and a contributor to the study. "Management's direction indicates that Walmart is aggressively working to advance its lower price position."