Winning with High Quality Research: Wal-Mart's Customer-inspired 2007 “Save Money. Live Better.”
COMPANY BACKGROUND AND BUSINESS CHALLENGE
Founded in 1962 with the opening of its first store in rural Rogers, Arkansas, Wal-Mart Stores has grown to become the U.S.'s and the world's largest retailer. Committed to a business model that drives costs out of supply chains to deliver everyday low prices to customers, Wal-Mart U.S. has grown to be an immense success among American consumers, achieving $226B in annual revenues and growing to more than 3,400 discount and supercenter stores in the U.S.
The company's scale has afforded it great efficiencies that allow it to drive its everyday low cost model, but it is the same immense scale and success that present a key challenge: How does a retail chain in which 84% of shoppers in the U.S. have shopped in the past year and in which over 100MM customers shop its stores in any given week continue to grow its share of customer spending? While a geographic penetration strategy via new store openings has been and will continue to be a necessary part of the answer to this question, new store openings' ability over time to win share of customer spending has its limits and those limits were beginning to become visible on the horizon in late 2005. At the same time, competitors like Target, JC Penney, Kohl's, Macy's, and others were making increasingly noticeable efforts to win share via advertising investment. It is within this context that senior management deepened its effort to win share of customer spending by radically changing its approach to marketing and advertising strategy.