Wal-Mart Stores (NYSE:
WMT) is in need of an image makeover in 2007 more than any other company -- in any industry -- in recent memory. Although the retailer has made strides in promoting "green"
ecologically sound strategies with its stores and with some of the products it carries, the critics of the world's largest retailer have had much more success beating the company down than the company has had promoting what is good for customers along with rebuilding an image since publicly stating the "happy face" logo that went through the store cutting prices would go away. What is Wal-Mart's image these days? Hard to state, as I think it's in limbo waiting for the right strategy to take hold.
Wal-Mart's Edelman-staffed "Action Alley" scrutinizes Wal-Mart's "
reputation management" to try and consistently combat the retailer's foes these days. Watchdog groups, consumer advocates, importing experts, economic pundits and even environmental outfits are always on the prowl to ensure the world knows the "other side" of Wal-Mart that results in the "Always Low Prices" its stores have. Those prices, according to many, come at a much larger global cost when all details are looked at as a whole.
So, what does the $10 million Wal-Mart reportedly pays PR firm Edelman get the retailer these days? That's quite hard to measure, but from my perspective, the company -- existing at its current state -- will never be able to overcome the negative publicity it is currently receiving without major fundamental changes.
I don't see those changes coming, quite honestly; in that respect, even a major image makeover will seem like a trite way to gloss over the black cloud hanging over the company. Most PR campaigns, in terms of remaking corporate images, can work very well. For one to work very well for Wal-Mart would take superhuman effort. It could be a lost cause before it ever began.
Reader Comments (Page 1 of 1)
3-26-2007 @ 8:40PM
Paul said...
It will be interesting to see what WalMart does to counter the port inspection ads.
Wall Mart has forever been known for "slave "wages along with it's lack of effort concerning employees health insurance.
The giant will have to learn that the market is full of retailers for the shopper to purchase from. Perhaps WalMart will be forced to join the 21st century.
3-26-2007 @ 8:43PM
Mike said...
So what are your suggestions Brian. What can the retailer do to appease its critics. Moreover, should it even bother to do anything?
$344 billion in sales in 06'on only $11 billion profit. Pretty slim margins (3%), so throwing money around isn't the answer.
What is the upside to "fixing" their image? Will new shoppers come out of the woodwork? Will existing shoppers spend more? Will the shareholders buy more stock?
I say tell the critics to stick it where the sun don't shine. It is a retailer for gosh sakes, not some social program designed to provide a "living wage" (whatever the heck THAT is) and full health coverage to the masses. Retail jobs are not known (industrywide) for providing salaries and benefits on par with autoworkers... should they?
I'm still waiting for someone to tell me how Target's pay and benefits match up? How do Target employees feel about their jobs and their employer? Compare apples to apples.
I'm sorry but when the UFCW...er, I mean Wake-Up-Wal-Mart and the SEIU...er, I mean Wal-Mart Watch put out press releases I can only think of one thing:
The unions would like to have 1.5 million new members. (yawn) I wouldn't hold my breath.
3-26-2007 @ 9:26PM
Grace said...
I am an old time Wally Fan...but no more... And it has nothing to do with the publicity and critics (I make up my own mind)... But whoever they have doing the buying and pricing certainly didn't learn it from old Sam... The pants I have bought faithfully for years ? Now made by a different company, and don't fit worth a darn...are made more cheaply, but at the same price... Same way with most of the goods now... And bargains ? I can do better price wise and quality wise at Target... Wal-Mart is shooting themselves in the foot...
4-10-2007 @ 5:54PM
Zenia said...
It would be nice if, let's say, the Walmart Culture was revived and taken seriously by everyone. Too many stores have too many people that think, well, they will shop here whether we treat them nicely or not. One of the top business strategies is always to remember that a lot of people wont do business with you, not because of your products, but because of your associates... bring back the good ole days, bring back the smiley, bring back the morning cheer, bring back the traing that has everyone smiling and greeting the customer...for real, not just on paper... and see how much happier the associates and the customers can get!
4-10-2007 @ 5:51PM
Zenia said...
Have more management actively enforcing WalMart Culture....
3-26-2007 @ 10:49PM
jtothegoffio3 said...
I work at Wal-Mart and it is a very dark company...I am an unloader and we get in trouble all the time about not getting the truck done in two hours. We are dreadfully understaffed, that they called me to come in today and I told them that I was out of town. Our store is jammed full of freight and stuff that we don't need. We're lucky if we have three unloaders there at a time. We have items in the back that have been there for literally a year now. The store manager is terrible, come to think about all the managers, except one are terrible. The customers are not happy when they shop there and neither are the employees. People at my store are constantly working past time, for which we get in trouble for, but have to in order to finish the unreasonable ammounts of projects they want us to do for our "masters".
3-27-2007 @ 5:22AM
Alan Hartung said...
Mike -
Continuous bad PR results in lost sales, no matter how cheap your prices are. I have not spent money at Wal-Mart in five years, and I know many who have at least cut down if not cut out their shopping at Wal-Mart because of how they treat their employees and their unethical business practices.
A comparison between Wal-Mart and Costco showed that a low-price store could pay their employees livable wages, provide health care, and be profitable. Since it's not completely fair to compare a standard Wal-Mart to a Costco, Sam's Club (which offers similar pay and benefits as a standard Wal-Mart) has a worse profit % from sales than Costco.
You seem to imply that they have no room to make changes with their profit margin. Perhaps they'd have more room if they paid and treated their employees better. When was the last time you walked into a Wal-Mart and it looked like even a third of the employees looked happy at work? I was in a Costco today and nearly everyone was happy as they went about their job.
3-27-2007 @ 8:38PM
Mike said...
If Wal-Mart (or Sams for that matter) staffed with as few employees as a Costco does there would be a lot fewer employees to BE unhappy.