The digital revolution has retailers and suppliers alike, scratching their heads. But on Tuesday (Nov. 27), Wal-Mart executive Stephen Quinn told a room full of suppliers there is no time to lose in the quickly evolving world of retail.
He also said many Wal-Mart core customers remain in an economic recession.
Quinn, chief marketing officer at Walmart U.S., provided the keynote address at the Bentonville-Bella Vista Chamber of Commerce WalStreet Speaker Series. A chamber official said more than 500 attended the event.
Quinn said Wal-Mart’s huge scale, often seen as sluggish moving forward, would not be left in the dust. Quinn challenged dozens of suppliers to get onboard with the retail giant as they work to integrate multiple retail channels and provide genuine customer satisfaction.
“Take the Scotts lawn business. I can see Wal-Mart partnering with them on a YouTube commercial, as an example,” Quinn said. “Think of Wal-Mart as an experience platform, that you can work with for retail development kit. Seek us out proactively and increase score card performance.”
This was not the first time Quinn has invited suppliers to partner in “experience platforms.” He mentioned it last year at an advertising conference according to New Market Builders CEO Carol Spieckerman.
Spieckerman noted in a recent blog, “ … the hinted at retail development kit would wrap paid, owned, earned and shared media into a supplier-ready package. I haven’t seen any updates since then, but clearly Wal-Mart is continuing to look at ways to harness its massive multi-channel reach, beyond simply serving as a distribution point for products."
‘REAL TIME’ SHIFT
Quinn told suppliers Wal-Mart was not “dialing for dollars” but serious about raising the return of investment for both parties as they work together aligning strategy, and planning a full-year calendar that integrates digital mediums with in-store initiatives.
Spieckerman and other analysts give Wal-Mart a nod of approval for stepping out front in these somewhat uncharted waters.
Admittedly, Quinn said, Wal-Mart has benefited from jumping into the Facebook platform early on, with little formal discussion. He said the initiative would have likely bogged down or been snuffed out had it gone through traditional corporate channels of protocol.
This shift to “real time” has been an important insight for Wal-Mart and challenged its nimbleness, but Quinn says the company is committed to constant interface with some 25 million Facebook fans and a growing number of mobile app users, Pinterest fans and Twitter users.
Quinn said the customer today wants a genuine experience and is responding favorably to the retailer’s low price ad campaign, which is filmed in 30 cities each week at roughly 90% less than the cost of last year’s ads.
He went as far to say that Sam would approve.
“More people watch YouTube than scripted television, and our ad campaign feels more like a reality show, which is resonating well with our customers. It’s been the most successful marketing tool we have seen to drive home the low price message,” Quinn said.
THE CORE CUSTOMER
He told the crowd Wal-Mart resembles a duck this year as it looks very calm on the surface but is “always paddling like the dickens underneath.”
Though much of Quinn’s speech had a marketing tone, he was very clear about the underlying message and mission upon which Wal-Mart is fixated – the customer. He said many of Wal-Mart’s core customers have not yet escaped the great recession.
“They rely on us more than ever for low prices on the things they need. The paycheck cycle has never been more pronounced than it is right now. People lining up at midnight to buy diapers and milk as soon as their plastic cards are loaded with funds. I thought it was bad 10 years ago, and if you had told me it would be worse today, I couldn’t have conceived that. But it is far worse,” Quinn said.
With that in mind, he said the boomers and millennials also require constant attention for entirely different reasons.
The “store of the community” concept is being resurrected as “buy local” is what more millennials want. Even if the price is slightly higher, the overall benefit of sourcing local is worth it to the social-minded millennials, according to Quinn.
He said aside from responsibility, retailers and suppliers must also be resourceful for many bargain hunting boomers because of the high level of transparency provided by the digital age. When asked about Wal-Mart’s low price priorities, Quinn said the retailer aims to use national branded products in its low-price guarantee over private labels. He said private labels have taken a back seat in Wal-Mart’s war on low prices and he urged suppliers to also think “national brands.”