retail news in context, analysis with attitude

Walmart yesterday said that Stephen Quinn, its longtime chief marketing officer, plans to retire in January, and that it is hiring Michael Francis, a three-decade veteran of Target Corp., to be a marketing consultant charged with initiating "a broad revamp of Wal-Mart’s marketing department," including the identification and hiring of Quinn's successor.

The Wall Street Journal reports that "the shake-up adds to a growing list of executive changes the world’s largest retailer has made in recent months as CEO Doug McMillon works to spur a turnaround and focus the company’s investments on long-term goals like boosting e-commerce sales and making stores more efficient, as well as appeal to higher-income shoppers. In October, Wal-Mart said longtime CFO Charles Holley would retire at year’s end and Steve Bratspies would become chief merchant."

The retiring Quinn is 56; Francis is 53.

The Journal story points out that after 27 tears at Target, Francis went to JC Penney to serve as president, joining Ron Johnson, with whom he'd worked at Target. After that went south, Francis ended up at DreamWorks Animation SKG as chief global brand officer for three years. "But the marketing executive is best known for helping to craft Target’s image over a nearly 27-year career at the retailer. He helped forge some of Target’s well-known designer partnerships, like a line of home goods by architect Michael Graves and limited runs of luxury items from fashion houses such as Missoni."

Meanwhile, as Walmart looks to retool its marketing strategies, Advertising Age reports that "in what seems to be a direct response to Amazon's sophisticated dynamic pricing, Walmart has been following the e-commerce giant's price fluctuation patterns, suggesting that rather than always sticking to the lowest price, Walmart must follow Amazon's pricing lead to compete."

The story goes on to say that "the availability of daily price data gathered by third party data firms crawling e-commerce sites, along with tools to automatically alter prices based on data analysis, is altering the retail landscape. This new reality is changing the rules for Walmart, which followed Amazon's pattern of price alterations relatively closely throughout November as measured by 360pi, not just on big days for sales."

Walmart is not commenting on the story, but experts tell Ad Age that it seems to be generally within five percent of Amazon on prices across the board.
KC's View:
You gotta give McMillon credit ... he's totally owning the changes he's making at Walmart, and if things go badly, there will be no question about there the blame will be placed. Conversely, if things go well, they'll build a monument to him in Bentonville.

It seems to me that at a time when discounting seems to be taking on considerable momentum in the US, it says something about its own pricing that Walmart does not seem content with its 'always low prices' message. The Bentonville Behemoth seems to realize that this is not enough, and it is making all these changes to protect its various flanks ... against Aldi over here, against Amazon over there, and then against Kroger over in that other place.

I guess the question I would ask is as Walmart plays defense, is it doing enough to play offense. If it positions itself as an alternative to Aldi or Amazon or kroger or Lidl or whoever, is it making clear enough statements about what it is ... not just what it is not. Because it seems to me that if Walmart is positioning itself to attract a customer base that is different from its tradition consumer, it has to establish its image in positive and differentiated terms ... while remaining attractive to its longtime shoppers.

Given that challenge, maybe I'd retire at age 56, too.