Wal-Mart

Save money. Live better

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Wal-Mart customers demand low
“

prices and value for their money and

that’s our promise here at Wal-Mart”

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 Origin Of Wal-Mart
 Milk boy
 Part time job with retail outlet
 Working with Butler Brothers
 Sales increased
 Importance of retail outlets
 Lease not renewed
 1950 birth of Wal mart store

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 Statistics
 Created 125000 new jobs.
 Total international stores 3000
 60% sales from middle class family
 Families visit the stores 50 to 60%
times a year.
 84% of the Americans have visited
Wal-Mart stores.

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 2 to 3% increase in consumers every
year.
 Growth of 13% in the next 5 years.

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 Customers
 It has a positive impact.
 Some say it has a negative impact
 Main competitors are K-mart, Target
Kroger Publix, Giant Eagle, Safeway
 Advantage over price
 3 Environmentally Demonstration
Stores.

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 Wal-Mart

Top Heavy Low Light

Shoppers Shoppers Shoppers Spenders
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 Demographics
 Latino and African American
 Older Shoppers
 New challenges

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 Technology
 Satellite communication.
 Radio frequency identification tags
 Up gradation of its system
 Designing 1st economical and
environmental friendly stores

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 Micro-environment Audit
o Market:
• Global retail industry touched $9,498 billion
in 2004.
• The estimated sales in the year 2009 will be
more than $12,000 billion.
• The US dominates the world retail,
accounting for 32.3% of the global retailing.
• Europe generates 30.8% of the total value,
Asia pacific-25.6% & rest of the world-
11.20%
• Wal-Mart revenue-US$ 404.16 billion(2009)
• Company growth: In 1975, sales $340.3
million
• In Jan 31-2009,sales $401.2 billion 10
2) Customer: Customer needs & buying
behavior

3) Competitors:
• K-Mart, Target, Kroger, Albertsons, Publex,
Giant Eagle, Safeway, Winn-Dixie.
• Future competitors trends

4) Distribution & Dealers

5) Suppliers

6) Facilitators & Marketing Firms 11

Marketing Strategy Audit
 Business Mission: Wal-Mart is guided by service
to our customers and striving for excellence.

 Marketing Objectives & Goals:

To bring low prices to their customers and also
relaying value to their customer for every dollar
they spend with the company.

 Strategies:
7. Operational Promotional Strategies.
8. IT Systems.
9. Some Stores open for 24X7 days.
10.To cover all segments from the low-income to the
upper income segments.
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 Wal-Mart's Performance
 Increase in overall profits for past 4 yrs.

 US households buy abt 22% of groceries from

Wal-Mart

 A profit Margin of 9.3% in 2005 as compared to

8.4% in 2002

 Its revenues represent 2.3% of US GDP.

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PRODUCTS:
 3 retailing subsidiaries: Wal-Mart Division
United States, Sam's Club and Wal-Mart
International.

 Wal-Mart does business under nine different

retail formats: super centers, food and drugs,
general merchandise stores, small markets,
cash and carry stores, membership warehouse
clubs, apparel stores, soft discount stores and
restaurants

 Neighborhood Market product line should be

discontinued
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 Wal-Mart should consider test openings of
hardware and tool stores

 AC Nielsen and Pew Research conduct a poll

according to which- ”Working families believe
Wal-Mart is a good place to shop and a valued
member of the community. 84% of Americans
have shopped at a Wal-Mart in the past year
and 69% of those familiar with Wal-Mart have
a favorable opinion of Wal-Mart." (Wal-Mart
facts, 2006)
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PRICE
 Wal-Mart's main competitors are Target, Costco and
K-Mart.
 Wal-Mart -$46.36.($48.94)
Costco -$52.39, ($49.13)
Target - $ 57.06 ($42.71)
K-Mart - $ 175.61. ($13.55)
 Distributors feel that Wal-Mart share will increase
by 13% in the next five years.
 Customer believe that by ending with a lack luster
third quarter and continued negative press Wal-
Mart will only see an increase of 5% or less in share
price

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PLACE
 Wal-Mart clearly has a distribution policy that is
monitored and regulated by the Security Exchange
Commission and shares distributed by NYSE

 With 50 distribution points globally, there is no

need for further distribution points.

 Wal-Mart has started distributing via the Internet,

such as E-Trade.

 Wal-Mart could ill afford to lose any of its

distribution channels.
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PROMOTION
 Advertising campaign always has focused on Every
day low Prices.
 Recently, Wal-Mart has slashed prices on 10,000
products for the holiday season.
 Wal-Mart has an in store television network that alert
customers to sales and promotions going on within
each store.
 if there is a price in a competitor's flyer ad that is
cheaper than their price show the competitor's ad
during check out and Wal-Mart will beat the price in
the competitor's ad.
 Logical advertisement and promotional campaigns
 No wrong promises.

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 Wal-Mart spent $841 million on advertising in 2004,
a 21 percent increase from 2003 when Wal-Mart
spent $694 million."

 Currently Wal-Mart has earmarked 978 million

dollars for it's advertising campaign for 2007.

 In 2002 , shifted its advertising and marketing

focus budget in getting to know the customers
personally and marketing to them accordingly.

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Marketing Information Systems
 Wal-Mart's vast marketing information system is
headquartered in Bentonville, Arkansas.
 Timely and accurate information for use by the marketing
managers to improve their marketing planning,
implementation, and control
 Wal-Mart's constantly monitors consumer data via purchases
made at register and items purchased via their online store.
 Wal-Mart has accurate sales forecast but over the last several
months Wal-Mart has seen a decrease in sales due to incorrect
coding on some 234 stores.
 Wal-Mart executives have corrected this current error and have
implemented procedures to prevent this same type of coding
area in the future.
 The large sums of data collected are collected in efficient
manners, which allow managers to make instant, decisions
about product promotion strategies. 20
SWOT Analysis
Strengths
 Wal-Mart is a powerful retail brand. It has a reputation for
value for money, convenience and a wide range of products all
in one store.

 Wal-Mart is the largest employer in the United States.

 Wal-Mart also has the second largest net sales in the world.

 Wal-Mart has a remarkable MIS and logistics system in place.

 Technology in general is an unbelievable strength that Wal-

Mart is able to invest in to improve their company.

 By having on-line shopping, Wal-Mart has allowed for 21

increased sales all over the world.

Weeknesses
 Wal - Mart has made it extremely difficult for small
retailers to survive. And hence people who are angry
with wal-mart for monopolising the retail industry refuse
to shop there.

 Since Wal-Mart sell products across many sectors (such

as clothing, food, or stationary), it may not have the
flexibility of some of its more focused competitors.

 The company is global, but has has a presence in

relatively few countries Worldwide.

 There are negative feelings towards Wal-Mart as a

retailing-giant because of issues concerning wages, 22
heath care and the environment.
Opportunities
 To take over, merge with, or form strategic alliances
with other global retailers, focusing on specific markets
such as Europe India or the Greater China Region.

 Also, Wal-Mart has the opportunity to work on improving

the environment. They have such a large image that any
programs they support have the ability to produce
tremendous results.

 Other growth opportunities include area specific and

culture specific stores via the Internet and improved
supply chain management through radio-frequency
identification (RFID).
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Threats
 Being number one means that you are the target of
competition, locally and globally.

 Being a global retailer means that they are exposed to

political and economic problems in the countries that
they operate in.

 Another threat is the rapidly growing chain of Dollar

General discount stores. These stores are able to open in
smaller areas where there are not enough customers to
support Wal-Mart.

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Conclusion
 Always low prices always have become synonymous to what
Wal-Mart stands for in bringing customers low prices with
value.
 Wal-Mart must focus on issues that it faces and find ways to
correct the problems by giving those problems 100 percent
executive attention.
 Continue expansion of stores on a domestic and global scale.
 The implementation of RFID technology should be increased
beyond the 1000 warehouse distribution points. Wal-Mart
should increase those ID tags beyond every pallet to every
piece of product the company receives from suppliers. In doing
so there would be a dramatic reduction in theft from
employees and customers.
 Wal-Mart must remember the customers that allowed them to
become the number one retailer globally; losing focus of this
will cause sales to plummet. 25
Thank You

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