retail news in context, analysis with attitude

Advertising Age reports that Walmart is plowing more of its TV commercial budget than ever into local spots, producing "price-comparison ads against local retailers in 60 markets this year, up from 50 last year. It's part of a plan that will see Walmart produce an eye-popping 1,500 TV ads in 2013. That's more than double the 615-plus it ran in all of 2012, which itself was up substantially from a year earlier, when new local ads up 79%, according to Advertising Benchmark Index."

According to the story, "the thrust of Walmart's local TV ads is comparing the cash-register receipts of consumers who shopped at a competitor to what they would have paid at Walmart (rather than looking at some artificially concocted market basket). And according to Advertising Benchmark Index consumer panels, the ads work. Walmart's local price-comparison ads average around 130 on the index, which factors in such things as likability and purchase intent, or around 30% above average for industry ads."

The Ad Age story notes that "a study on 70 items in January and February by Consumer Edge Research found Walmart beat Kroger and Safeway most of the time on prices, though Kroger beat Walmart on beverages and Safeway tied Walmart on dairy.

"While Safeway's prices were 19% higher than Walmart's overall, Dollar General actually beat Walmart in the study, while Family Dollar, Kroger and Target were all within 2% to 3% of Walmart's prices. Target beat Walmart for people using its RedCard and getting 5% savings.

"A Kantar Retail survey found Walmart prices to be on average 4% lower than Target's in January, with edible grocery 14% lower than Target nationally. That was Walmart's best performance on those metrics since the survey began in 2009 -- though RedCard users still would have spent slightly less on the items than at Walmart."
KC's View:
This full-court press by Walmart suggests that most companies competing with the Bentonville Behemoth have to make sure that they are emphasizing products and services that clearly differentiate them. Most have to do what Billy Beane did in "Moneyball" - play a different game than the Yankees do.