Wal-Mart may not benefit from popular ads

17 December 2009

NEW YORK: Wal-Mart, the US retail giant, has produced the most popular holiday season advertising in its category, but this might not equate to an increase in sales, a new study has found.

Figures from the Retail Advertising and Marketing Association showed that 26% of American shoppers regarded one of Wal-Mart's festive TV spots as being their favourite compared with competing efforts from other chains.

Some 16% selected an execution from Target, which had been the top-ranked company in this area for each of the last three years.

Best Buy, Gap and Macy's completed the top five, with Old Navy, Kmart, Sears, Hallmark and Kohl's among the other organisations that had made a positive impact on this measure.

However, only 17% of respondents said their preferred ad would lead them to shop at the retailer in question, while 50% took the opposite view.

Indeed, a third of the panel already visited the store behind their chosen commercial with the highest degree of frequency.

More broadly, consumers viewed coupons as playing the most profound role in shaping where they spent their money this Christmas, with 45% of people affording them such a status.

Word-of-mouth and advertising inserts were mentioned by 27% of adults, with broadcast TV on 23%, newspapers on 22%, and direct mail on 21%.

In-store promotions received a score of 18%, a total that fell to 16% for email advertising, and single digits for cable TV, magazines, online ads and radio.

Mike Gatti, executive director at the Retail Advertising and Marketing Association, said "there's so much more out there to decide from ... This could also be due to the shift over the last year away from some traditional media into a lot of the new media."

Many customers "still get a kick out of the commercials, but there are a lot of brand loyalties out there," he added.

However, at  a minimum, communications can help retailers take a "position in the minds of people whether they shop there or not," Gatti suggested.

Turning to the internet, Wal-Mart was perceived as providing the most impressive offers on the web by 20% of the sample, with Amazon on 18%.

A majority of contributors said these types of deals would not influence where they made online purchases, although 22% reported that they could be encouraged to switch.

"Shoppers aren't only relying on traditional advertising to find the best deals," said Phil Rist, executive vice president of strategic initiatives at Big Research, which conducted the survey for the RAMA.

"Whether they were saving on shipping or using an in-store coupon, shoppers dug through every avenue of potential savings before choosing to commit."

Data sourced from AdAge; additional content by Warc staff