ANA Annual Meeting

As Walmart Prepares to Turn Corner, CMO Quinn Is in a 'Sharing' Mood

Suppliers Urged to Share, Too, in Retailer's New 'Experience Platform'

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Walmart may be earth's largest retailer and employer of more than 1% of the U.S. labor force, but it also would like a little help from its friends.

Speaking as a marketer at the Association of National Advertisers convention in Phoenix today, Walmart Chief Marketing Officer Stephen Quinn, took on the role of media vendor, too, unveiling a newly developed "Retail Development Kit" aimed at attracting more spending and participation from the small army of suppliers in the room.

"Technology isn't the end, it's a means to an end," he said, "and the end is people want to share." So Walmart is working to redesign every aspect of its consumer marketing and merchandising to be "social by design," he said, such as a recent partnership with Facebook to develop the My Local Walmart app customized to each of the retailer's nearly 3,600 stores -- which he said combines two major initiatives to focus on both community and technology.

It was just one sign of what a difference two years can make.

In 2009, when Mr. Quinn took the same stage, he was master among the ANA's "Masters of Marketing" universe, one of few CMOs having recently delivered top-line growth amid a deep recession.

Today, he spoke as Walmart appears poised to end two years of comparable-store sales declines. And he had a more somber view of how the recession has permanently changed consumers -- and Walmart's marketing approach.

"To paraphrase the famous Wendy's ad, 'Where's the Growth?'" said Mr. Quinn, referring to the "Growth" theme that 's been a staple of the ANA conference since, ironically, the financial-crisis-plagued crisis of 2008.

"Coming out of the 2008-2009 financial crisis, things are fundamentally different, and they're permanently different in the U.S. economy, " Mr. Quinn said.

Walmart's own struggles and the appointment of Bill Simon as U.S. CEO last year led the marketing department to reassess what was working and not working, based on a fundamental reassessment of customers, Mr. Quinn said.

With a disappearing middle class, declining median family incomes and rising poverty rates in the U.S., he said consumers value things differently today.

Mr. Quinn said people have recognized "we've gorged ourselves on mass affluence, and we did it by piling up a mountain of debt." In response, customers are making a "shift to responsibility," as they dump debt and pay cash, leading Walmart recently to bow to the drumbeat of customer demand by restoring layaway for toys, electronics and jewelry.

"People are educating themselves online before buying," Mr. Quinn said, making lists and mapping out their entire shopping trips item by item, leading Walmart to re-emphasize its guarantee to match competitors' advertised prices. And because people are emphasizing one-stop shopping to save money on gas, Walmart began refocusing on its breadth of assortment.

Walmart is also increasingly focused on the fastest-growing segment of its customer base -- Hispanics -- and on technology solutions to its problems, he said.

Indeed, one message Walmart kept getting loud and clear on its Facebook page, whether it brought the subject up or not, was how many customers wanted to bring back layaway.

The consumer frugality, Mr. Quinn said, is also fueling a shift toward "a subscription model" instead of buying things like DVDs and CDs. So Walmart, while it still sells plenty of DVDs thanks to its deep library and $5 discount offerings, also bought Vudu and has the streaming service automatically installed on almost every TV, DVD or Blu-Ray player it sells.

Suppliers, too, can get in on the sharing Mr. Quinn said, making an interesting pitch for Walmart as a media and marketing services option, not just the distribution. It's a substantial shift from one of his predecessors, who was cited by suppliers as saying: "We're not the marketing. We're the market."

"Just as we see our customer through a new lens, I'd like to invite all of you to view Walmart through a new lens as well," Mr. Quinn said. "We see Walmart as an experience platform to grow your business, a platform that can reach almost 200 million customers a week."

He called the platform the "Retail Development Kit," likening it to the "Software Development Kit" that online platforms provide. In a sneak peak at the RDK, Mr. Quinn showed a wheel of options that include in-store marketing events, point-of -purchase displays, Walmart "Smart Network" in-store TV, circulars, ads on and cinema ads among other things.

"This will be your toolkit to use Walmart as your platform to build multi-channel experiences and engage your customers" using "paid, owned, earned and shared media," he said.

"At the end of the day," he said, "we're all in this together."

Not every supplier, however, is seeing Walmart's outreach through the same lens. An executive for one who'd seen Mr. Quinn's talk said the CMO did a good job of showing the retailer's softer, "fluffier side," but added in a rhetorical question: "Have you talked to your commercial people lately? They're kicking the crap out of us," referring to the hard line the retailer is taking in negotiations.