It's time to get unorthodox. Put down the calculator, turn off the rambling analyst on CNBC, and let the all-knowing Google Trends predict the future of Walmart(NYSE:WMT). Collecting information from a search engine may seem silly at first, but think about it. Investing is one big popularity contest, or at least that is how it seems. Therefore, internet search volumes can give extremely helpful insight into competitors, international sales, and overall interest in a company.
No Love For Walmart? Wrong.
There has been a growing concern that Walmart is losing its touch. Its power. Its Mojo. Whatever you want to call it. Lets take a look at overall search volume for "Walmart" over the past 5 years.
Using June as a benchmark, Walmart has seen and increase in search volume from a level of 29% in 2009, to 59% in 2013. It is also important to note search volume reached a peak of 100% in December of 2012. As you can see, search volume has steadily increased year after year. But what about competition? Who cares about search volume when you have nothing to compare it to?
Enter Target (NYSE:TGT) and Costco (Sorry Kmart). Recent articles tout the decline of Walmart, proclaiming a new era. An era dominated by target (or Costco, depending on who you believe). According to the all-knowing Google Trends, this speculation may be nothing but hot air. In December of 2012, Walmart search volumes were twice as high as Target, and four times as high as Costco (NASDAQ:COST). Numbers like that are hard to ignore, especially during the holiday season.
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Lets dig a little deeper. For these retail giants, dominating in the consumer electronics department is essential. Curious as to why the electronics section is in the back of the store? Electronics will attract a large volume of customers into the store. Therefore, herding customers all the way to the back of the store will promote buying of products along the way. Strong electronic sales equates to impulse buying. Below, we can see an even greater disparity.
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Walmart reached a search volume of 84% of peak in December of 2012. That compares to Target and Costco's numbers of 37% and 22%, respectively. Now that we have established that Walmart is the clear winner for worldwide search volume, lets examine international volume growth.
Canada and Mexico are the main focus here. Solid consumer interest and search volumes in these countries indicate effective supply chains, as well as brand awareness. Below are 5 year volumes from both Canada and Mexico.
More of the same. Walmart dominates search volumes again in international markets. It looks like it's not even close. Although I expected Walmart to have higher search volumes, the disparity certainly is shocking. One thing is for sure, Target and Costco have some work to do.