The sets may be silent, but grumbling is growing louder among some marketers that Wal-Mart's in-store TV advertising system isn't working for them. While no one wants to publicly criticize WMTV for fear of angering the retail giant that controls so much of their business, several privately confess that shoppers don't seem to notice WMTV; that there isn't sufficient testing of the system and that they are buying it mainly to curry favor with Wal-Mart.
"It's never on and shoppers aren't watching," said one marketer, a Bentonville, Ark.-based vendor to Wal-Mart. "It's touchy and no one wants to tell Wal-Mart it isn't working."
"You can't hear anything and [the screens] are so out of position and so high and not where they should be for customers," agreed a food-company executive. But then again this marketer has no expectations that the system will actually sell its products. "We look at [advertising on WMTV] as more as a relationship build with Wal-Mart as opposed to a wise media purchase."
Michael Anderson, a media buyer at Cincinnati's Empower Media Marketing, said that kind of thinking fits with several of his clients that have bought, against his advice, into WMTV. "When we ask them why they have to run Wal-Mart TV, they say, `to make Wal-Mart happy."'
No quid pro quo
Mark Mitchell, exec VP-sales at Premiere Retail Networks, which created and manages the in-store system for Wal-Mart, strongly refutes the idea of a quid-pro-quo atmosphere around the network. He said advertisers buy WMTV because it works, not to please Wal-Mart. "If a marketer came and bought it just for a relationship, that's a bad decision on their part."
As for a third marketer's comment that PRN doesn't allow it to do "matched-panel tests" within Wal-Mart ("They talk about these vague case studies and how this and that works, but I don't buy it. If they let me test it and I could prove it, I'd say, `sign me up and I'll advertise all day long."') Mr. Mitchell said those kinds of tests aren't allowed because "we would be testing ourselves to death." PRN prices also allow for 10% of WMTV sets to be out of commission.
Mr. Mitchell's 16-person sales staff tells advertisers that the WMTV audience rivals that of a national TV network and is independently audited and measured by Nielsen. He argues it's a better measured audience than TV, since intercept surveys of 3,600 individuals are done, compared to 5,000 for in-home people meters. Surveys are based on awareness and recall, though, and WMTV is not set up to link advertising run on the network to in-store transactions.
"We reach 130 million viewers over each four-week period," Mr. Mitchell said. "Wal-Mart foot traffic is 400 million, so that number is who watches vs. who is just going through the store." Even so, Mr. Mitchell admits gaining shoppers' attention is not easy: "As much as we think we are doing a great job building this network, we still just have 36% watching it."
PRN was founded in 1992 as a consolidation of several companies with programming deals for TV walls in electronics retailers, such as Best Buy and Sears. Today, PRN has revenue of about $100 million and is entering its third year of profitability. Although PRN offers programming at 10 other retailers, including Albertson's and Sears, Wal-Mart is its only storewide network.
Jay Ellis, director-sales strategy for Wal-Mart and Sam's Club with Dreyer's, the Oakland, Calif.-based maker of the regional Edy's Grand and Dreyer's ice cream brands, said the company four months ago shifted money from its national media and sampling budget to WMTV, because of the ability to zone brand messages regionally. The results look promising.
"There is increased lift when Wal-Mart TV is running," said Mr. Ellis. "Do we have all the information back? No, not yet. ... What we've seen is a spike in sales, but we've also rolled out some new items, so it's hard to know if it is owed to Wal-Mart TV."
Kaki Hinton, VP-advertising services for Pfizer Consumer Health Care, which began advertising on WMTV in 1997, said she has steadily increased spending in the medium. Although PRN gets a small slice of Pfizer's massive budget, Ms. Hinton said she can link WMTV buys to transactions, but would not share results beyond saying: "We can prove a positive ROI."