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Quinn: Wal-Mart and Its Marketing Is a 'Work in Progress'

Hearing the Criticism, Retailer Says It's Listening to Voices Outside of Bentonville

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ORLANDO, Fla. (AdAge.com) -- Stephen Quinn, senior VP-marketing at Wal-Mart Stores, said the makeover of the retailer and its marketing "is very much a work in progress right now."
Stephen Quinn, Wal-Mart's senior VP-marketing: The retailer, he said, is working hard to learn more about the customer and answer the question: 'What does she hire us to do?'
Stephen Quinn, Wal-Mart's senior VP-marketing: The retailer, he said, is working hard to learn more about the customer and answer the question: 'What does she hire us to do?' Credit: Rohanna Mertens

"You'll see a different Wal-Mart in 2007," he said, as Wal-Mart reworks its stores to make each more relevant to its community. In a presentation today at the Association of National Advertisers' annual conference, Mr. Quinn discussed how the nation's biggest retailer has "put the customer at the forefront."

Quite a few customers
And Wal-Mart has quite a few of those customers: Last week, he said, 114 million Americans -- more than one-third of the population -- bought something at Wal-Mart.

Given its size ($312 billion in sales last year), the former executive of PepsiCo's Frito-Lay noted Wal-Mart this year will have to add the equivalent of a PepsiCo in revenue just to keep its growth plan on track.

Mr. Quinn credited Wal-Mart's CEO H. Lee Scott Jr. with taking the initiative to talk with the retailer's critics in hopes of improving the company's business and reputation. "He started listening to people from outside the company," Mr. Quinn said, on issues such as sustainability. That helped drive Wal-Mart's ambitious plan to reduce its own use of energy, reduce the size of packaging and promote the sale of green-friendly products such as energy-saving light bulbs. "Big can make a big difference," he said.

Mr. Quinn noted that Hurricane Katrina last year proved to be a something of a turning point for Wal-Mart. The company reacted before the storm and was widely praised for getting supplies into devastated areas while the government struggled to respond. "Katrina brought out the best in our company," he said. "It taught us that big could be good."

From the customer's perspective
In his talk, he also discussed how Wal-Mart is segmenting customers, customizing stores and improving the quality of its products as part of its plan to drive growth. Wal-Mart, he said, is working hard to learn more about the customer and answer the question: "What does she hire us to do?"

The retailer will work to keep its "loyalist" customers happy, he said, but it hopes to get "selective" shoppers -- who visit more than 40 times a year but shop only limited departments -- to spend more in areas, such as electronics and apparel, where Wal-Mart has upgraded its offerings.

He noted Wal-Mart still has a challenge to win over a third key customer segment, "skeptics," who like Wal-Mart prices but still have misgivings about the company. "From my experience," he joked, those Wal-Mart skeptics "seem all to be journalists."

In his presentation, Mr. Quinn gave indications that the giant retailer feels media don't always present a fair picture of its business practices, such as its health-care benefits for employees. "Wal-Mart does provide health care for the vast majority" of employees, Mr. Quinn said, adding: "Tomorrow, that will be in the paper, but not the way I said it."

Appealing to the 'Cadillac set'
Mr. Quinn also discussed Wal-Mart's plan to tailor stores to the community. While it's not feasible for Wal-Mart to make each store unique, he said, it is possible to stock stores to better fit the community. He cited differences in an urban store in Illinois, a store in a Hispanic community in New Jersey and a store in Plano, Texas, that appeals to affluent consumers with offerings such as a $200 bottle of wine. "We're proving that Wal-Mart can appeal to the Cadillac set," he said.

Wal-Mart's massive expansion in organic food has turned out to be a "phenomenal PR move," Mr. Quinn said, stressing that the retailer championed the effort to deliver lower-cost organics for reasons other than publicity.

On the media front, Mr. Quinn discussed the power of its in-store TV network. The retailer is starting to reprogram its in-store TV so that customers in different departments will see more targeted messages.

In a Q&A after his presentation, one attendee asked if Wal-Mart's recently announced move to sell low-cost generic prescriptions was helping win over skeptics and was also a loss leader that would draw in customers to buy other goods. Mr. Quinn said the generic plan was an example of "Wal-Mart getting on its game." But, he added, "I wouldn't say it's a loss leader" because Wal-Mart's approach is built on everyday low prices across the store.
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