“If it weren't for Wal-Mart and Target, Kmart would be the most successful retail chain in the country, in my opinion, ” says Al Ries of Ries and Ries and author of Positioning: The Battle for Your Mind. And perhaps Kmart envisioned a world where that was actually the case. But in reality, Wal-Mart had been gaining on Kmart since its inception and Kmart didn't notice until it was too late. What Kmart failed to see was Wal-Mart wasn't just out to do things better than Kmart, it was out to dominate the discount retail arena. 1 One of the ways it managed to do that was through consistent competitive intelligence and maneuvering. All the while Kmart looked the other way.
“From the time anybody first noticed Sam [Walton], it was obvious he had adopted almost all of the original Kmart ideas. I always had great admiration for the way he implemented—and later enlarged on—those ideas. Much later on, when I was retired but still a Kmart board member, I tried to advise the company's management of just what a serious threat I thought he was. But it wasn't until fairly recently that they took him seriously, ” states Harry Cunningham, Kmart's first CEO, in Sam Walton's biography. 2