Could the Luster on Walmart-Cheap be Fading?

For the last decade Walmart has been on a tear, and has been crushing everything in it’s path. However the tide may be turning, slowly albeit – the pricing gap between rivals (Target etc) has been on the decline and while Walmart has been touting their lower prices (which they do have) other companies have been focusing on other capabilities – quality service, clean stores and unique fashion-forward designs for less money from less well known, as well as celebrity endorsements. The attitude seems to be that if you can’t beat Walmart at their own game, then other vendors have to change the subject – and it seems to be working. There has also been somewhat of a mutiny as higher end products have decided that selling in huge volumes may come at a price – and that price is the declining value of their brand as anyone can buy Tommy Hilfiger or other formerly premium brands at the least expensive store in town – and without any of the quality customer service or pampered experiences that customers have come to expect with premium brands.

Although from a price and convenience standpoint you simply cannot beat a Walmart Superstore with their rumored 142,000 products in stock, you can most definitively find stores that will treat you better and provide service that is more in line with the quality of premium goods that many customers long for.

Then there is the experience of going into one of those stores where finding your product can be an adventure all in itself, and if you’re fortunate enough to find a customer service representative, it’s obvious that their time spent with you is measured in seconds, not in minutes. They’re attitude seems to be that everything is available in their store and if they can point you in the right direction “isle 3 D on the left hand side”, then their job is done. Their knowledge about different brands is only as deep as what the tag says on the item, and they’re obviously not paid more to hold your hand and help you make a wise decision – and it shows. In Walmart you’re on your own – Walmart is simply an enormous convenience store and it’s your job to choose the right product, pay for it and be on your way.

However, now some shoppers, especially those that consider shopping an experience, as opposed to those who consider shopping a competition to find the cheapest deal, may be deciding that the Walmart-cheap has gone too far and that they want some knowledgeable, helpful attendants to make sure that they buy the right product, not simply the cheapest product with an increasingly common name brand.

It will be interesting to see how this evolves with time, but the one sure thing that can be seen is that Walmart sales are becoming the vestige of the cheapest among us, and to answer Walmart advertisements “Always the cheapest prices, always”, I for one would rather have a reasonably good shopping experience than standing in line after line, wondering if I really bought the product that best suites my needs.

The real danger in this for product marketers is that by selling premium brand products in the cheapest store in town, may cause the brand to decline in terms of it’s cache. And that cache is something that is hard earned, but easily lost. In the simplest analysis Walmart an offer you incredible sales volumes that you may not get anywhere else, but the long term effect on your brand should be factored in.

Know thy costumer and think about the meaning that your distribution channels have one it’s brand promise. Do you really want to be the high volume low touch product that Walmart offers you? The answer probably depends on your brand’s positioning in the marketplace.

Chris Hawkes
www.MarketResearch101.com

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