Competitors take issue with Wal-Mart ads

by The City Wire staff ( 11 views 

Competitors tired of being singled out by Wal-Mart touting lower prices in television ads have decided to fight back in several states, according to a report by Wall Street Journal.

Wal-Mart ads have targeted retailers including Toys "R" Us and Best Buy Co, as well as several regional supermarket chains. Best Buy complained about a Wal-Mart ad to the Florida attorney general's office, while Toys "R" Us complained to Michigan officials, the Journal said.

The stores allege that the prices Wal-Mart uses for its in-ad comparisons are inaccurate.

Best Buy reportedly took issue with the Dell laptop advertised at $251 less expensive at Wal-Mart. Per Best Buy’s complaint to the Florida Attorney General, the two laptops in the ad were different models, so the claim in the ad “would be like comparing a Toyota to a Lexus.”

In response, Wal-Mart says it never claimed in the ad that these were identical laptops.

But as the Journal points out, Walmart agreed in 1994 — as part of a resolution to a legal dispute with Target over price-comparison ads — to no longer compare products that weren’t the same size or model without noting differences.

Wal-Mart spokesman Steven Restivo defended the retailer's ad campaign that claims to offer better prices on some products than competitors.

“We are confident in the legal, ethical and methodological standards associated with our local grocery basket and national price comparison ads. We’ve looked closely at our process and execution and encourage others to do the same, as we go to great lengths to follow all local, state and federal rules and regulations,” Restivo said in an e-mail.

He said Wal-Mart ads are supported by a rigorous internal process to help ensure accuracy, which includes legal review and oversight as well as documentation supporting our statements about quantities and pricing. Several local news outlets have done grocery price comparisons of their own and have come away with similar results.

“The positive customer feedback we’ve received is a reflection of how much consumers appreciate being educated about where to find the best value in their community. We know competitors don’t like it when we tell customers to compare prices and see for themselves but we think consumers deserve every chance to find value.”

The Federal Trade Commission’s statement on comparative advertising says, “When truthful and non-deceptive, is a source of important information to consumers and assists them in making rational purchase decisions. Comparative advertising encourages product improvement and innovation, and can lead to lower prices in the marketplace.”

Wal-Mart said it has responded to attorneys general in Michigan, Illinois, Pennsylvania, and Missouri over complaints from regional supermarket chains and Toys "R" Us.

The company said it has not received complaints from Best Buy. The attorneys general offices in Florida and New Jersey said they were reviewing similar complaints.