2011 Issue 8

Bob Connolly retired from Walmart in 2006 where he most recently served as Executive Vice-President for both Merchandising and Marketing.

In 2000 Bob was named the first Chairman of the Center for Retailing Excellence at the University of Arkansas’ Sam M. Walton College for Business.  In 2005, an endowed scholarship in retailing was established in Bob’s name.  Bob co-authored The Big Middle, published in the Journal of Retailing.

Bob now works both privately and in conjunction with the Center for Retailing Excellence, consulting and advising corporations and business groups worldwide on how to take advantage of trends, business analysis from the customer’s point of view, and the miracles and missteps of branding.

Bob has worked with Disney Corp., International Resources, Inc., Spectra, Unilever, Georgia Pacific, Microsoft, Ben & Jerry’s and Massmart.

In addition, Bob serves on the Board of Directors for Husqvarna in Sweden.  He travels extensively, giving him a first-person view of the ever-changing world of the customer.  Bob publishes a newsletter at www.customerbob.com. 

2011 Issue 8

WALMART STARTS AD CAMPAIGN ON " WE WILL MATCH ANY PRICE"

WALMART STARTS AD CAMPAIGN ON “WE WILL MATCH ANY PRICE”  

Bill Simon (CEO Walmart USA) unveiled a new price matching TV spot at a recent analyst conference.   The ad features a cashier at Walmart matching a price immediately when a customer claimed the item was cheaper someplace else. 

Retired Walmart marketing chief Paul Higham along with ad agencies Bernstein Rein, GSD&M, E. Morris and Lopez Negrete built the awareness among consumers that Walmart was “Always Low Prices.”  And they understood the way to market the concept.  Of course the substance behind the campaign was that Walmart really had low prices, and the merchants were charged with keeping them the lowest.  Paul’s philosophy was that if you had to advertise that you match prices, you were saying to the customer “if you catch us we will meet the price.”  Of course it is impossible to have the lowest price on everything everyday, and when a customer did challenge a price, Walmart would meet it.  In those days, Walmart was the cause of other stores having a price matching campaign.  Now it seems the tables are turned. 

Unfortunately for Walmart, this new campaign may be necessary.  Not only must they re-convince customers that they have low prices, but also direct and audit their internal decisions to support that strategy.  Low prices are always up to interpretation, as is every day low price (no sales), and will be challenged often internally.  So Paul, sorry, Walmart may need the ads.

Here are a few areas of this policy to watch:   

1.    In the ad it is my understanding that the cashier makes the decision to match a price.  Great, great, double great!!!  However it was a  $0.20  decision.  What happens when the item is a TV and the difference is $100?

2.    If you really are going to have opening price points in every category, it is equally important that you have them on the products that are contemporary for the category.   Really who cares if you have a great price on a 13-inch analog TV, or a dial phone?   That is not where the action is.

3.    As the low price leader, why do you allow suppliers to run tag ads featuring your Walmart name and logo along with other retailers?  The message is you are only as good as the other guys. 

Well at any rate, I am glad to see Walmart trying to reestablish itself as the “always low prices” store.  Come to think of it, that would be a good campaign.