Big Lots Bundle
What are Big Lots' Customer Demographics and Target Market?
Understanding who shops at Big Lots is key to its strategy. As a discount retailer, it aims to attract value-seeking consumers across various life stages. This focus on affordability shapes its approach to product assortment and marketing efforts.
Big Lots' customer base is primarily composed of value-conscious shoppers who are actively looking for deals and savings on everyday necessities and home goods. The company's strategy has historically revolved around attracting these shoppers through a constantly changing inventory of discounted merchandise, a core element in its Big Lots Porter's Five Forces Analysis.
In fiscal year 2023, Big Lots experienced a significant downturn, with total net sales decreasing by 13.6% to $4.7 billion from $5.5 billion in fiscal 2022. This financial performance, which included a net loss of nearly $482 million, highlights the challenges in retaining its target market amidst evolving consumer behaviors and increased competition. The company's recent bankruptcy filing in September 2024 and subsequent operational agreements underscore the critical need to re-evaluate and strengthen its connection with its core demographic.
Who Are Big Lots’s Main Customers?
Big Lots primarily engages with value-conscious consumers in the Business-to-Consumer (B2C) market. The company's core customer base is characterized by price sensitivity, actively seeking savings on a variety of goods including home essentials, furniture, and seasonal items.
Core Customer Profile
The typical Big Lots shopper prioritizes affordability and is often found in suburban and rural areas. This segment is driven by the opportunity to find significant discounts and deals.
Income and Spending Habits
In the first half of 2024, Big Lots' customer base was drawn from areas with a median household income of $65.5K. The company's strategic decisions, such as closing stores in areas with a median HHI of $73.5K, underscore a commitment to serving this price-sensitive demographic.
Product Appeal
The company's merchandise, particularly its offerings in furniture and home decor, appeals to shoppers looking for budget-friendly ways to furnish and enhance their living spaces.
Loyalty and Penetration Goals
Big Lots has historically cultivated a loyal customer following, especially among shoppers in suburban and rural settings. The company's objective to increase 'bargain penetration' to 75% and 'extreme bargain penetration' to 50% by the end of 2024 highlights its focus on this core consumer behavior.
Understanding Big Lots Customer Base
While specific demographic data like age, gender, or education levels are not extensively publicized, the emphasis on value and discounts shapes the Big Lots customer profile. This aligns with a Marketing Strategy of Big Lots that targets individuals and households prioritizing cost savings.
- Focus on price-sensitive shoppers
- Appeal to bargain hunters
- Targeting suburban and rural demographics
- Offering affordable home goods and furniture
Big Lots SWOT Analysis
- Complete SWOT Breakdown
- Fully Customizable
- Editable in Excel & Word
- Professional Formatting
- Investor-Ready Format
What Do Big Lots’s Customers Want?
The core needs and motivations of Big Lots' customers are centered around obtaining significant value and affordability across a wide array of products. Shoppers are drawn to finding deals on everything from furniture and home decor to groceries and seasonal items. This focus on savings is directly met by the company's strategy of sourcing closeouts, overstocks, and direct imports, appealing to a consumer base prioritizing budget-friendly purchases.
Value-Driven Shopping
Customers are primarily motivated by the desire to find substantial savings. This need for value is a key driver in their purchasing decisions across various product categories.
Affordability Focus
The company's sourcing methods directly cater to customers seeking affordable options. This strategy ensures a consistent supply of discounted merchandise.
'Treasure Hunt' Experience
The constantly rotating selection of merchandise creates an element of discovery. This shopping experience appeals to customers who enjoy finding unique bargains.
Macroeconomic Impact on Spending
Current economic conditions, including inflation, have led consumers to prioritize necessities and reduce spending on high-ticket items like furniture. This trend influences purchasing behavior towards more budget-conscious choices.
Adapting to Consumer Behavior
In early 2024, a PYMNTS Intelligence survey indicated that 86% of U.S. consumers adjusted their grocery shopping due to rising prices. Of these, 44% switched to more affordable retailers, highlighting a significant shift towards value-oriented shopping.
Marketing and Product Strategy
The company uses digital campaigns and store layouts to emphasize deals and bargains. The goal is to make it easier for customers to identify savings opportunities.
Addressing Customer Pain Points
Big Lots directly addresses customer pain points related to budget constraints by emphasizing its 'unmistakable value'. The company aims for a 75% bargain penetration by the end of 2024, reflecting a strong commitment to affordability.
- Increased focus on grocery items to meet consumer demand for affordable options.
- Leveraging digital campaigns to highlight deals and savings.
- The company's sourcing strategy directly supports the need for discounted products.
- The 'bargain to brag about' satisfaction is a key psychological driver for shoppers.
- A new rewards-enabled app launched in November 2024 enhances the personalized shopping experience for members.
Understanding the Target Market of Big Lots is crucial for tailoring these strategies effectively, ensuring that the company continues to meet the evolving needs and preferences of its diverse customer base.
Big Lots PESTLE Analysis
- Covers All 6 PESTLE Categories
- No Research Needed – Save Hours of Work
- Built by Experts, Trusted by Consultants
- Instant Download, Ready to Use
- 100% Editable, Fully Customizable
Where does Big Lots operate?
As of 2025, Big Lots maintains a significant retail footprint with 903 stores operating across the United States. The company's real estate strategy has historically focused on identifying over 500 markets, with a particular emphasis on rural and small-town areas, aiming to capture price-sensitive shoppers in these regions.
National Store Distribution
Big Lots strategically places its stores in affordable mid-tier metropolitan areas and growing suburban markets. This approach ensures accessibility for its core customer base, who often prioritize value and convenience.
Key State Presence
Ohio, the company's home state, hosts the largest concentration of stores with 83 locations, representing 9% of its total. Texas and Florida also hold significant market share, each accounting for 9% and 8% of stores, respectively, benefiting from their expanding suburban populations and cost-conscious consumers.
Regional Strongholds
Southeastern states, including North Carolina with 7% of stores and Tennessee with 4%, are vital markets for the company. These areas are characterized by affordable living costs and ongoing suburban development, aligning well with the company's target demographic.
Store Optimization and Rebranding
In response to market dynamics, Big Lots has adjusted its physical footprint. In December 2024, Variety Wholesalers acquired at least 200 Big Lots stores and two distribution centers, with plans to operate them under the Big Lots brand. These reopened locations, primarily in the South and Midwest, aim to maintain a strong presence in markets with established customer loyalty, as detailed in the Revenue Streams & Business Model of Big Lots article.
Store Density in Smaller Markets
Kentucky exhibits a notably high per capita store density, underscoring the company's strategic focus on serving smaller cities and towns effectively.
Geographic Focus of Reopened Stores
The majority of the stores acquired by Variety Wholesalers and reopened under the Big Lots brand are situated in the South and Midwest regions of the United States.
Key States for Reopenings
States such as North Carolina, South Carolina, Ohio, Pennsylvania, Virginia, Georgia, Kentucky, Tennessee, and West Virginia have seen a significant number of store reopenings in early to mid-2025.
Big Lots Business Model Canvas
- Complete 9-Block Business Model Canvas
- Effortlessly Communicate Your Business Strategy
- Investor-Ready BMC Format
- 100% Editable and Customizable
- Clear and Structured Layout
How Does Big Lots Win & Keep Customers?
Big Lots focuses on attracting and keeping its value-seeking customers by highlighting its unique offerings. A key strategy is to "own bargains," aiming for 75% bargain penetration by the end of 2024, with 50% extreme bargain penetration, to consistently provide substantial savings. This directly appeals to the price-sensitive nature of the Big Lots shopper demographics.
Value Communication and Bargain Focus
The company emphasizes communicating unmistakable value through its marketing efforts. A core objective is to achieve 75% bargain penetration by year-end 2024, with a specific goal of 50% extreme bargain penetration, ensuring consistent and significant savings for its customers.
Loyalty Program Enhancement
To foster customer loyalty and encourage repeat business, Big Lots utilizes its 'Big Reward' program. The launch of a new rewards-enabled app in November 2024 enhances the omnichannel experience, offering members easy access to in-store rewards and personalized offer notifications.
Omnichannel Strategy and Digital Engagement
Big Lots is committed to increasing store relevance and winning customers for life through its omnichannel initiatives. The introduction of the new app and an affiliate program in September 2024 are key steps in strengthening its digital presence and engagement with the Big Lots customer base.
Driving Future Growth
Despite recent sales challenges, the company anticipates a return to positive comparable sales as 2024 progresses. This outlook is supported by strategic actions focused on e-commerce improvements and operational efficiency, aiming to solidify the Big Lots target market characteristics.
Loyalty Program Benefits
The 'Big Reward' program offers compelling incentives to its members. These benefits are designed to encourage consistent shopping and enhance the overall customer experience, aligning with the Big Lots customer profile.
Rewards Structure
Members receive 5% off every purchase, a $5 reward for every three purchases, and a $10 bonus for every $200 spent on furniture. Additionally, using the Big Lots Credit Card earns a $5 reward for every $100 spent.
Exclusive Perks
Beyond transactional rewards, the loyalty program includes exclusive perks such as free weekend items, birthday surprises, and special coupons. These elements contribute to building a stronger connection with the Big Lots ideal customer.
Digital Integration
The new mobile app provides members with a personalized dashboard to track earnings and receive exclusive notifications. This digital integration is crucial for improving customer engagement and accessibility to rewards, supporting the Brief History of Big Lots.
E-commerce Development
Recognizing the need to bolster its online capabilities, the company is actively working on its e-commerce strategy. Enhancing digital engagement is a key factor in meeting the evolving needs of the Big Lots target market demographics.
Strategic Focus for 2024
The company's strategic responses, including its e-commerce initiatives and operational efficiency efforts, are vital for future growth. These actions are designed to drive positive comparable sales and strengthen the Big Lots customer segmentation analysis.
Big Lots Porter's Five Forces Analysis
- Covers All 5 Competitive Forces in Detail
- Structured for Consultants, Students, and Founders
- 100% Editable in Microsoft Word & Excel
- Instant Digital Download – Use Immediately
- Compatible with Mac & PC – Fully Unlocked
- What is Brief History of Big Lots Company?
- What is Competitive Landscape of Big Lots Company?
- What is Growth Strategy and Future Prospects of Big Lots Company?
- How Does Big Lots Company Work?
- What is Sales and Marketing Strategy of Big Lots Company?
- What are Mission Vision & Core Values of Big Lots Company?
- Who Owns Big Lots Company?
Disclaimer
All information, articles, and product details provided on this website are for general informational and educational purposes only. We do not claim any ownership over, nor do we intend to infringe upon, any trademarks, copyrights, logos, brand names, or other intellectual property mentioned or depicted on this site. Such intellectual property remains the property of its respective owners, and any references here are made solely for identification or informational purposes, without implying any affiliation, endorsement, or partnership.
We make no representations or warranties, express or implied, regarding the accuracy, completeness, or suitability of any content or products presented. Nothing on this website should be construed as legal, tax, investment, financial, medical, or other professional advice. In addition, no part of this site—including articles or product references—constitutes a solicitation, recommendation, endorsement, advertisement, or offer to buy or sell any securities, franchises, or other financial instruments, particularly in jurisdictions where such activity would be unlawful.
All content is of a general nature and may not address the specific circumstances of any individual or entity. It is not a substitute for professional advice or services. Any actions you take based on the information provided here are strictly at your own risk. You accept full responsibility for any decisions or outcomes arising from your use of this website and agree to release us from any liability in connection with your use of, or reliance upon, the content or products found herein.