How much does Wal-Mart save its customers?

Posted Mar 31st 2008 4:09PM by Zac Bissonnette
Filed under: Wal-Mart (WMT), Marketing and Advertising

In an effort to beef up its image -- which has taken a beating from union activists and the media -- Wal-Mart (NYSE: WMT) has sought to portray itself as a company that has a good effect on the country in a broad way.

To that end, the company has been running ads touting the "fact" that it saves that average American family $2,500 per year.

But the National Advertising Division of the Council of Better Business Bureaus is set to release its finding that the claim is misleading, promoting a statistic "for which the advertiser provided no support and, in fact, conceded that there was none."

Apparently Wal-Mart pulled that claim out of a study it commissioned that found that its stores emphasis on low prices led to a 3% decline in overall prices. But the BBB found that the "implied claim" that consumers who shop at Wal-Mart will save $2,500 more than comparable families in the same area who don't was misleading.

Of course, this isn't the first time that Wal-Mart has used fuzzy math to conjure impressive statistics that can be used to imply things that the data didn't. Earlier this month, I wrote about the company's recent claim that "This month, Wal-Mart Stores, Inc. will open 81 new stores and clubs across the country, providing jobs for 26,000 associates."

Of course that statistic didn't include the jobs that will be lost as volume at other stores declines from the force of competition. There's nothing wrong with that -- that's capitalism. But Wal-Mart's newfound obsession with its image has tossed the corporate spin machine into high gear, and the company appears to be willing to sacrifice the truth for impressive PR. In the long run, that will hurt it's credibility, especially with so many critics all too eager to point out any misleading statements.

Tags: inthenews, Wal-Mart, WMT