How is Wal-Mart able to sustain its economic profit in the face of intense competition?
In an article by Burt Helm from Business Week Online, March 28, 2007, Wal-Mart CEO: “I’m not a big fan of marketing”. He later said he meant just “advertising,” but that’s what Chief Executive Lee Scott replied when I asked him what he expected from the upcoming ad campaign, and how the company planned to get shoppers to buy items like apparel (Business Week Online, 2007). The CEO goes on to He started things off with a harsh assessment of last year’s plan to get more of the 137 million Wal-Mart customers interested in items like apparel and home goods. "We're defined by our customer, not by us...We found we can’t wake up and try to do something new and not earn it,” said Scott. He continued: “You couldn’t have spent enough marketing on Wal-Mart apparel last year.” He said he that though they went “too far, too fast,” they hadn’t altogether abandoned the strategy.
So after a tumultuous year in the marketing department, Scott told us he wants to stick to Wal-Mart’s low-price image, and focus on things like smart consumer research and store planning. The key is having the right product in the right place for the right price, he said, and there’s no reason to try anything fancy. "I care that we have good ads, but whether we have a good TV ad or a bad TV ad doesn't make a difference," he said. "The point is reinforcing the message” (Business Week Online, 2007).
I have always been impressed by Wal-Mart’s ability to gain the market share they have.
My only disappointment with them has been their recent indiscretion in hiring and promotion practices of female employees.
Wal-Mart has created barriers to entry; they have been copied but so far, not surpassed. Wal-Mart ...