Go to the Globe and Mail homepage

Jump to main navigationJump to main content

The Wal-Mart Canada Meadowvale store in Mississauga store, Sept. 12, 2011. (J.P. MOCZULSKI/For The Globe and Mail/J.P. MOCZULSKI/For The Globe and Mail)
The Wal-Mart Canada Meadowvale store in Mississauga store, Sept. 12, 2011. (J.P. MOCZULSKI/For The Globe and Mail/J.P. MOCZULSKI/For The Globe and Mail)

With eye on new Canadians, Wal-Mart caters to a diverse palate Add to ...

The discount titans of U.S. retailing are poised for a fight over the market for new Canadians.

Wal-Mart Canada Corp. , already well established, is boosting its efforts in the growing and lucrative area, while Target Corp. looks to both “localize” and bring its U.S. experience north.

The approaches of the two underline the urgency for retailers to grab the business of new residents, whose buying power is roughly $50-billion a year and growing, according to Wal-Mart data.

In a recent presentation, Wal-Mart outlined how it is moving to ramp up its “store of the community,” which caters to local tastes and needs. It’s about 40 per cent along the way in serving Chinese and Southeast Asian Canadians in the food aisles, with offerings such as Chinese eggplant and Shanghai bok choy.

“It’s really important for us to win our share of that market,” said Emma Fox, senior vice-president of marketing at Wal-Mart Canada. “Actually it’s really a necessity because all the future market growth in terms of spending is coming from the new population growth. It’s coming from our new Canadians.”

Wal-Mart has been building its local strategy for years, using the buying power of its international teams to help stock products from overseas targeted at new Canadians, particularly those of Asian descent. Now it can tap into that expertise as a way to take on Target, which some analysts say has more of a one-size-fits-all approach to merchandising, although that’s changing.

Target, which will open in Canada next year, is working on a two-pronged approach.

“We spent the majority of time in 2011 learning about the retail market in Canada and learning about the unique provinces and communities and the needs and wants of future [customers]in these communities,” said spokeswoman Lisa Gibson. “We are working through how we will localize while still ensuring we bring the true Target experience to Canadians.”

Wal-Mart is far from alone among retailers in trying to grab the multiethnic market, and now it’s betting it has an advantage over Target, even as the latter pumps up its localized initiatives in its U.S. home base.

“Wal-Mart is more evolved in regionalized [offerings]and store formats,” said Wayne Hood, retail analyst at BMO Capital Markets in Atlanta. “They’ve been more global – longer – than Target has been.

“In Canada, there’s a learning curve for Target around what those regional preferences are and how to source them to be competitive.”

Other retailers also are stepping up their offerings. Loblaw Cos. Ltd. acquired Asian supermarket specialist T&T a few years ago, and is applying its ethnic model to parts of its mainstream stores. Even Canadian Tire Corp. has tested the waters.

“The urgency is this: Growth of the new Canadian population is about five times the rate of the overall population,” said Kaan Yigit, president of Solutions Research Group. From 2008 to 2011, more than a million new immigrants came to Canada, “basically equal to the population of Edmonton. And this is happening every four years.”

Wal-Mart uses one of its supercentres in Toronto as a laboratory for tailoring offerings to the large surrounding Asian population, stocking such items as eels and coconut twists and setting up fish, meat and bakery counters run by specialized Asian suppliers.

Results so far are encouraging: Since the beginning of the fiscal year, sales in that store rose 8.9 per cent from a year earlier, while customer counts grew 11 per cent, said Alan Blundell, vice-president of merchandising at Wal-Mart Canada.

Report Typo/Error

Follow on Twitter: @MarinaStrauss


More related to this story


Next story




Most popular videos »

More from The Globe and Mail

Most popular