We’ve been following the price tug-of-war between Target and Walmart as the two retail giants battle for the right to claim they’re the cheapest in the land. It seemed Target had the edge on Walmart last year, and now new research suggests you really will “pay less” at Target.

Bloomberg Industries ran the numbers and found that this month, prices at Target were lower than Walmart for the first time since October 2011. Not only is Target cheaper, but it widened the price gap with the biggest margin since Bloomberg began studying the two companies two years ago.

The numbers this time around came from studying the prices of 150 common items at stores within five miles of each other, as consumers looking for the best prices in tough economic times would be likely to compare prices at their local retail spots. Of course it’s a no-brainer — we go where the cheaper price is.

Target’s big gain this month game from undercutting Walmart’s food prices. Sam Walton’s company had an advantage of 4.5 percentage points in July, but dropped down to only 1.35 percentage points this month. According to an analyst for Bloomberg Industries, Target’s food improvement could be tied to back-to-school promotions.

In the study, prices at Target were 0.46 percentage points cheaper than Walmart in August. In other words, for every $100 spent, Target was cheaper by $0.46.

“Consistent with our long-time practice, Target regularly shops competitors to ensure we are at price parity on like and identical items in local markets,” said a Target spokeswoman in a statement.

Overall, however, Walmart says it’s still king of the discount.

“Anytime there’s an environment with high-low retailers, pricing surveys will reflect some differences,” a Walmart spokesman said in a statement. “Walmart is delivering everyday low prices — not pricing gimmicks — every day, 365 days per year, not just during a single week or during a particular season. Our customers don’t have to wait for a sale or look for an ad.”

But for Target to win this round despite things like Walmart’s Ad Match guarantee, well, that’s kind of embarrassing ,says one expert.

“Wal-Mart has been rolling out 88-cent deals and very publicly communicating its ad-match campaign, so it’s a real blow that Target has managed to trump them on price,” says an analyst with Planet Retail.

The one bright spot for Walmart — it still has an advantage over Amazon, says another study that found Walmart was cheaper on average by 20% on a range of 36 items. Hold that fact close, Walmart.

Target Cheaper Than Wal-Mart As Gap Widest In Two Years [Bloomberg]

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