Retail Management-Walmart

1. Retail Marketing Strategy
Presented By
Group-3
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2. A retail marketing strategy refers to how a store and its products sell goods to its
target customers. Each type of retail business has to make decisions about all the
details of its marketing mix. A marketing mix consists of the product, price, place,
promotion and packaging. A retail marketing strategy is first outlined in a business
plan.
A business plan contains information about the intention and goals of the company.
It's created before a business opens. Business plans include research about who the
company's potential customers are as well as what their needs and wants are.
A retail marketing strategy should be a part of the business plan. It should include
decisions about the marketing mix approach, such as how customers will get the
products.
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3. For instance, a furniture company may choose a large warehouse, while a jewelry
manufacturer may decide to sell only over the Internet. Other businesses may select a
combination of a brick and mortar store for in person customer purchases plus a
website for customer online shopping. All retail marketing decisions should consider
the target customer as well as the company's profit. For example, having an etail
website rather than a retail store may save on overhead costs, but it won't be a
profitable choice if the target customer isn't likely to shop online.
Common retail marketing strategies involve how products and stores are positioned
and differentiated.
A differentiation strategy focuses on products that can stand out from the
others competing for the attention and dollars of the target market. For example, a
furniture store may offer hand-made products or other items very different from what
competing stores are offering. Of course, the product shouldn't only be different, it
has to be something that targeted customers want and need. Retail market
differentiation must set stores and products apart in order to create strong branding.
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4. Branding is the identity of a product or service. Retail products and services in the
same industry can differ widely from each other.
For example,
low-cost hair cutting services are branded and differentiated from upscale salons by
their "no frills" store design. Expensive hair salons, on the other hand, are usually very
detailed and fashionable in their store's look. As part of it's retail marketing strategy,
an upscale salon may be positioned to potential customers as trendy, while the low-
cost basic hair cutting establishment's market positioning could be promoted
as budget-friendly.
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5. Retail Management 5

6. • Wal-Mart Stores, Inc.,Walmart is an American multinational retail
corporation that operates a chain of discount department stores and warehouse
stores.
• Headquartered in Bentonville, Arkansas, the company was founded by Sam
Walton in 1962 and incorporated on October 31, 1969.
• It has over 11,000 stores in 27 countries, under a total 71 different brands.
• The company operates under the Walmart name in the US and Puerto Rico. It
operates in Mexico as Walmart de México y Centroamérica, in the United Kingdom
as Asda, in Japan as Seiyu, and in India as Best Price. It has wholly owned
operations in Argentina, Brazil, and Canada.
• Walmart is the world's largest company by revenue, according to the Fortune
Global 500 list in 2014, the biggest private employer in the world with over two
million employees, and the largest retailer in the world.
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7. Advertising slogans:
Save Money. Live better
Mission Statement, Vision, Goals, & Purpose
Vision:
“If we work together, we’ll lower the
cost of living for everyone…we’ll give
the world an opportunity to see what
it’s like to save and have a better life.
Mission Statement:
To help people save money so they can
live better
Goal:
Becoming in an international brand
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8. Business Formats
Walmart's operations are organized into three divisions:
• Walmart Stores U.S.
• Sam's Club
• Walmart International.
The company does business in nine different retail
formats: supercenters, food and drugs, general
merchandise stores, bodegas (small markets), cash and carry
stores, membership warehouse clubs, apparel stores,
soft discount stores and restaurants
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9. INTERNALFACTORSEXTERNALFACTORS
STRENGTHS WEAKNESSES
OPPORTUNITIES THREATS
SW• Diversity in products & services
• Convenient prices & locations
• Strong market presence
• Customer loyalty
• Strong financial performance
• Cost and pricing advantages over
rivals
• Good supply chain
• Global Expansion: new geographic
areas
• Increasing online sales
• Strategic alliances
Acquiring rival firms
HarmfulHelpful
•Brand image-weak
reputation
•Low global presence
•Behind rivals in e-
commerce
• Intense Competition
• Laws and Regulations:
Trade policy
• Cultural barriers
• Current economy
• Slow market growth
• Transport of distinctive
comptency
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10. PESTEL Analysis
• Political: Policies on economy, trading agreements (NAFTA…) .
• Economical: Unemployment Rate, slightly increase in consumption.
• Socio Cultural: Faster pace of live- Efficiency is key.
• Technological: Use of IT technologies. Online shopping.
• Environmental: Recycling, Contamination issues.
• Legal: More laws and more complex.
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11. Business-Level Strategy:
Combined Strategy
Wal-Mart combines a Cost-Leadership and Differentiation strategies
because:
I. Allowed to achieve a large scale and an efficient supply chain.
II. Has its own low-cost brands, like Great Value.
III. A unique cost structure that allows Walmart to establish the lowest prices and achieve
competitive advantage. (best value/price combination )
IV. Present in many different industries and markets with efficient distribution channels.
V. Very difficult strategy to imitate by offering a broad quantity of products at a low price.
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12. Walmart International
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13. Examples of International Success
• China:
– Most populous country
– Lower income in middle-class families
– Adaptation to market
– 85% of products from local suppliers.
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14. Examples of International Failure
Germany
– Walmart was not able to benefit from economies of scale
– Unable to become cost leader
– Culture differences
– Low profitability market
India
– Political and legal barriers:
• Foreign companies are not allowed to set up big stores unless
they sell only one brand.
South Korea
– Very demanding customers
– Did not customized to market
– Big companies also fail in South KoreaRetail Management 14

15. Current Developments (2011-present)
• In January 2011, at the urging of Michelle Obama and her staff, Walmart
announced a program to improve the nutritional value of its store brands over the
next five years, gradually reducing the amount of salt and sugar, and
eliminating trans fat.
• Walmart also promised to negotiate with suppliers such as Kraft with respect to
nutritional issues. Reductions in the prices of whole foods and vegetables were
also promised as well as efforts to open stores in low-income areas, "food
deserts", where there are no supermarkets.
• On April 23, 2011, the company announced that it was testing its new "Walmart To
Go" home delivery system where customers will be able to order specific items
offered on their website such as groceries, toiletries, and household supplies. The
initial test is in San Jose, California, and the company has not said whether it will
be rolled out nationwide.
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16. • On November 14, 2012, Walmart launched their first mail subscription service
called Goodies. Customers pay a $7 monthly subscription for five to eight
delivered food samples each month, so they can try new foods.
• In August 2013, the firm announced it was in talks to acquire a majority stake
in the Kenya-based supermarket chain.
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17. Key Success Factors
• A supply chain with integrated technology
• An ability to generate large sales volume (economies of scale)
• Every Day Low Prices
• Superior logistics systems
• Decentralized operations
• A strong and unique culture (in U.S.)
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