Walmart Renews Every-Day-Low-Price Promise
April 12, 2011
Walmart is taking aggressive steps to reestablish its low-price dominance and one-stop shopping convenience, which it has recently ceded to competitors such as Target.
The world’s largest retailer is renewing its price leadership promise, bringing back products it previously cut from its inventory and simplifying its ad match policy, which Walmart is broadcasting far and wide in a new advertising campaign launched this week.
“Walmart’s reputation was founded on the principle of providing low prices day-in and day-out on the broadest assortment of merchandise,” said Duncan Mac Naughton, chief merchandising officer of Walmart U.S. “Our company is determined to create the best one-stop shopping experience and low prices on the right products backed by a clear, consistent ad match policy.”
A recent report in CNN Money said that price research conducted by Customer Growth Partners revealed rivals such as Target had slightly lower prices than Walmart on everyday items such as milk, cereal, clothing, and health and beauty care products. This is the first time in four years that Target has been able to gain price dominance over Walmart, which typically maintained a 2 percent to 4 percent lower price lead, according to the research company.
Responding to the competitive slip, Walmart is vowing low prices, every day on everything. The retailer promises to:
- Increase competitive checks with store managers and product buyers checking the competition more often “to help ensure stores offer lower prices on the right mix of items.
- Partner more closely with suppliers to lower the cost per item and pass those savings on to customers.
- Simplify its ad match policy to make it easier for customers who no longer have to bring in a competitor’s advertisement as proof of discount. If customers find a lower advertised price, Walmart will match it at the register. The company is also implementing new associate training to ensure the policy is executed consistently and correctly across all store.
- Broaden product assortment by approximately 8,500 items, or 11 percent, in the average store.
“We’ve listened to our customers and we’re bringing back the products and brands they want,” Mac Naughton said. “Customers have already seen a wider selection of products on our shelves and we’ll continue to bring back great products at great prices.”
Customers can easily identify these items with new “It's Back” flags on store shelves.
In the video below, Walmart also makes a point of reminding customers it accepts manufacturer coupons.
In other Walmart news, the retailer is reportedly testing grocery delivery service in the San Jose area of California. If the test is approved, customers can shop online and get delivery of their shopping orders, according to a Bloomberg report.
“Wal-Mart needs to get more serious about e-commerce, so that would be interesting,” Matt Nemer, analyst at Wells Fargo, told Bloomberg. “Grocery delivery works in urban markets, and they already do it in the U.K., so they have experience.”
Walmart, however, declined to comment on the test. “There are rumors about our business all the time and we don’t comment on them,” Ravi Jariwala, a Walmart spokesman said. “We will continue to evaluate our assortment to determine where to expand and best serve our customers.”
SBD Views: The story of Walmart's return to its roots continues to evolve. A clear campaign to re-establish pricing leadership is in full swing. Of equal interest is Walmart's attempt to let consumers know that many products previously deleted have been reinstated. -- John Failla for Store Brands Decisions.
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