How Are We Supposed to Feel About Walmart? Other Than Bad?
As a guy living on a cramped, overpopulated island -- Manhattan -- that lacks most American big-box retail chains, I used to have something of a Walmart fetish. In fact, whenever I'd go to visit my mom in suburban Rhode Island, I'd always sort of hope she'd want to bring me to the land of "Always Low Prices."
My mom, you see, usually has errands she wants me to help her run when I visit -- things like shopping for heavy stuff that she'd rather not manage on her own. (She'll say things like "You're so strong" -- exactly the sort of thing a deskbound writer likes to hear -- as I grab giant sacks of kitty litter off a store shelf and heave them into a shopping cart. I love my mom.) Out of all the stores we might visit, Walmart was, for a long time, the most alluring to me.
For good reasons: The spacious aisles, wider than my apartment! The ridiculously low prices! And, of course, the overall Walmart mythology -- the most successful chain store in history, with sales that add up to more than 2% of the U.S. GDP.
Over the past few years, though, I've had an attitude adjustment. For one thing, my mom increasingly finds Walmart to be too exhausting -- and so do I. The supersizing of Walmarts into extra-sprawling "supercenters" has turned the experience of shopping there from a challenging but doable hike to a daunting, enervating death march. And Walmart seems to run out of stuff it never used to run out of. (In March, Bloomberg Businessweek reported that Walmart has systemic problems with keeping its shelves stocked thanks to logistical screwups and a "thinly spread workforce.")
But beyond the increasingly unpleasant experience of shopping at Walmart is the subtext of shopping at Walmart -- the crummy feeling I have about going there because of what's become of the chain's brand image.
Basically, Walmart can't seem to stop getting caught attempting to shortchange its workers. In 2008, for instance, the company agreed to pay as much as $640 million to settle more than 60 lawsuits related to pay violations. Other violations and hefty fines have followed, and in May of last year the U.S. Department of Labor recovered $4.83 million in back wages and damages on behalf of 4,500 Walmart workers the retailer claimed weren't eligible for overtime pay (by law, they were).
In July of last year, by the way, Vermont Sen. Bernie Sanders tweeted, "Today the Walton family of Walmart own more wealth than the bottom 40 percent of America" -- a startling assertion that PolitiFact analyzed and declared to be true.
In May of this year, the Democratic (of course) staff of the U.S. House Committee on Education and the Workforce issued a report saying that, "After analyzing data released by Wisconsin's Medicaid program, the Democratic staff ... estimates that a single 300-person Walmart Supercenter store in Wisconsin likely costs taxpayers at least $904,542 per year." In other words, because Walmart pays its employees so poorly -- an average of $8.81 an hour (chainwide, not just in Wisconsin) -- and is so stingy with benefits, many of its employees have to go on public assistance. Which means taxpayers are indirectly subsidizing Walmart by funding a social safety net for its employees. (In 2012, Walmart earned $17 billion in profits.)
And this month Walmart is in the news anew because it's threatening to cancel plans to build three District of Columbia stores because of D.C.'s "living wage" bill, which would mandate that Walmart pay a minimum wage of $12.50 an hour.
It's worth noting here that even some Democrats and liberal commentators are hoping that D.C.'s mayor vetoes what they see as a misguided bill (it passed the council 8-5) because residents of D.C.'s most economically depressed neighborhoods could use some new job opportunities -- any job opportunities -- and ready access to, yes, cheap goods.
It seems likely Walmart will score a "victory" in D.C. -- though one that does little to repair the company's tarnished image. Arguably, what Walmart has come to stand for in the media -- a certain sort of corporate ruthlessness and avariciousness -- is now what its brand stands for. The way I see it, the relentlessly negative media narrative is drowning out Walmart's smiley-faced brand messaging. In other words, Walmart doesn't have a marketing problem, it has a core values problem.
After all, you don't have to be a pro-regulation anti-capitalist to think that there's something wrong with the way Walmart is doing business these days. Last week, for instance, Loeb Associates retail analyst Walter Loeb, formerly of Morgan Stanley, Walmart Stores'>Walmart Stores'>Walmart Stores Such A Mess?">trashed the company in a Forbes.com guest post, using words like "disarray," "unappealing" and "unsanitary" to describe his experience visiting a Walmart in Pittsfield, Mass. He singled out the "filthy" bathrooms as a sign of the "disregard management has for customers and employees."
Here I could bore you by quoting all manner of management studies that state the obvious -- that there's always a domino effect in retail, and if your employees are unhappy, sooner or later your customers will be, too -- but there's a much easier way to sum up why the land of "Always Low Prices" has become such a miserable place:
Karma is a bitch.
Simon Dumenco is the "Media Guy" columnist for Advertising Age. You can follow him on Twitter @simondumenco.