Walmart, Target and Amazon Are Spending Billions to Reset the Shopper's Reference Price

Walmart, Target and others are using tariff refunds to announce cuts or holds on prices, absorb costs and reinforce value perceptions. Years of inflation, constant promotions and digital comparison shopping have made shoppers less certain about what products “should” cost, pushing retailers to compete on price certainty, memorable value cues and fewer reasons to keep searching. Walmart is betting on everyday price credibility, Target on private label that resists direct comparison, and TJX on scarcity and discovery.

Years of inflation, promotions, personalized discounts and constantly shifting online prices have made shoppers better at finding deals. They have also made it harder for shoppers to know what anything is supposed to truly cost, a fact that is being sharpened against a backdrop of weakening shopper confidence and a globally softening macro environment.

That, in turn, is making today’s emerging retail battle less about who has the lowest price today and more about who gets to establish the price consumers regard as normal tomorrow. After all, in many ways, retail spent the past decade systematically undermining the very idea of a normal price. Black Friday became Black November. Amazon turned Prime Day into a major retail season, competitors responded with their own events, loyalty programs introduced member-only pricing and retailers layered digital coupons and personalized promotions on top. The strategy worked so well that it created a new problem: consumers learned to wait. Amazon moving Prime Day into June this year helped pull spending forward from July, illustrating how promotional events can move demand through the calendar rather than create it.

The retail strategy against 2026’s operational backdrop isn’t one of cutting prices everywhere. As headlines this week from Target, Walmart, Amazon and other retailers show, it is figuring out which 100 prices determine what consumers think about the other 100,000.

See more: Amazon and Walmart Want to Beat the Consumer to Their Next Purchase

The Great Retail Trade-Down Is Becoming Permanent

Consumers today have more price information than ever and potentially less confidence in the meaning of any individual price. Walmart, for example, isn’t treating lower prices simply as a merchandising decision. It is effectively treating them as an investment. Milk, eggs, detergent, diapers, cereal and other frequently purchased products function as informal benchmarks. Shoppers know approximately what they should cost. Those products help consumers form an opinion about the affordability of thousands of other products whose prices they cannot track. Walmart had more than 11,000 price rollbacks during the second quarter, compared with about 7,200 at the end of the first quarter. Target, which has lowered prices on more than 10,000 products over the past year, says it will continue to “invest in price.” TJX is also planning to use a projected tariff refund to offset merchandise costs, limiting the pressure to push those costs onto shoppers.

“Your shoppers don’t necessarily buy more food because they see lower prices,” Furner added during the cal...