Can Wal-Mart keep its recession-era customers in the future?


When Wal-Mart Stores, Inc. (NYSE: WMT) changed its corporate slogan from "Always Low Prices" to "Save Money. Live Better" over a year ago, little did the retailer know that a recession would pour many new customers into its doors for bargains. With millions of families still strapped for cash, the retailer is still booking green at a time when many retailers are seeing red on the bottom line. The question, then, becomes this: can Wal-Mart retain its newer customer legions once the economy returns to normal (whatever normal is)?

Wal-Mart will always retain a certain customer segment -- those that shop on price and place a value on the convenience of purchasing tires, haircuts and carrots inside the same shopping trip. But customers -- many of whom can be finicky almost all the time -- can acclimate to trendier, name-brand stores when money is good and worries are small.

Now is not one of those times, of course. But Wal-Mart is not waiting on the economy to change for the better -- wider aisles, easier navigation and improved merchandising in some areas has already happened. In essence, the retailer wants to somewhat emulate shopping experiences that mass merchants typically can't provide in a gamble to keep more customers even when the economy is not shaky.

Is Wal-Mart trying to be all things to all people? It already is in a large sense. It simply wants to keep growth going by keeping higher-margin customers in its stores now and in the future. It's not abandoning the big-box format -- just upgrading the experience inside it. Wal-Mart seems to have impeccable timing, a crystal ball, or has the speed needed to keep growth going inside a recession and outside one as well. The retailer attracts more than 140 million customers a week and topped $400 billion in sales for 2008. And, it wants to grow even more. Perhaps that will help keep its share price above $50 consistently, yes?
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Last updated: February 10, 2012: 02:40 PM

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