Can Walmart turn its haters into lovers?

Discussion
Photo: Walmart
Nov 19, 2018
Lee Peterson

Through a special arrangement, what follows is an excerpt of an article from WayfinD, a quarterly e-magazine filled with insights, trends and predictions from the retail and foodservice experts at WD Partners.

When we surveyed more than 4,000 shoppers, asking them to rank their favorite brands out of 100 retailers, no other company elicited the kind of polarizing responses that Walmart did. About half loved Walmart; the other half didn’t.

When asked what retailer “gets me,” Amazon.com was chosen as the top brand by 81 percent of respondents, up from 79 percent the year before. By comparison, only 56 percent chose Walmart as a retailer that “gets me,” although, notably, that was up from 53 percent the year before.

Digging deeper, we found people who love Walmart, really do love Walmart. That loyalty is built around one theme: price. The bad news is that the people who don’t like Walmart, really don’t like Walmart. They had one consistent and unifying gripe: customer service. Their reputation with some consumers for treatment of workers may also be an issue.

So how can Walmart turn its haters into fans?

Our research indicates there might be some underlying demographic explanations as the household income of Prime users ($150,000) is well above the average Walmart shopper’s ($56,482.) However, we don’t believe it is the determining factor since Amazon is admired across income levels, genders and ages.

On the conceptual front, Walmart just introduced Town Centers, an idea that centers on transforming its big boxes into areas with green space, outdoor seating, strategic partners and city-like amenities that could potentially be a draw for the current Walmart haters. Walmart’s recent acquisitions also indicate the retail giant is looking to expand its customer base, or, at the very least, learn from smart brands like Bonobos and Eloquii.

Moves to increased wages and the introduction of a five-year, $100 million Retail Opportunity Initiative to support educational opportunities and career advancement shows Walmart recognizes it needs to make improvements on the customer service front.

In the end, more research might unearth what’s really going on here. Is this divide within Walmart’s customer base reconcilable? Only one thing is certain: competing with Amazon will not allow settling for a 50-50 split between lovers and haters.

DISCUSSION QUESTIONS: What do you think explains the polarized nature of Walmart’s supporters and detractors? Is Walmart taking the right steps to bring its perception into better balance with Amazon’s?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"They have GOT to care more about the store experience. Not in their innovation stores -- in all of their stores."
"As long as Walmart stays the course and continues to innovate while adhering to its roots of low prices, the company has a more than reasonable chance to cross the chasm."
"If Walmart increased prices and invested in better customer service, they would lose core customers, but attract new ones. It would be a zero sum game."

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28 Comments on "Can Walmart turn its haters into lovers?"


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Shep Hyken
BrainTrust

Any retailer knows that you can’t be all things to all people. Walmart and Amazon are better at appealing to the masses than most retailers. That said, Walmart knows not every consumer will buy from them. That doesn’t necessarily mean they are a loud detractor. It’s just that they choose to do business elsewhere. As for the vocal Walmart “detractors,” the group that doesn’t like how Walmart runs its company (wages, etc.), that is a very small group.

Paula Rosenblum
BrainTrust
Well, Walmart has a history of going places with stores where people quite loudly request they please NOT come. As such, the unique qualities of many small towns have been ruined and, over the past decade or so, they’ve been working on cities too. Let’s take Miami. They worked on getting a location in Midtown for eight years. The city didn’t want them there, the neighborhood was just wrong, but they wanted what they wanted and went around every law in the books to finally force the city to approve it. Right down to hiring people ($100 a pop) to wear “I heart Walmart” t-shirts to the planning board. This was all pre-McMillon. Now, do I think the company is changing? Yes, I do. They have yet to start building that store in Midtown (I really hope it never gets built — I would have welcomed it in another location closer to where I live, so it’s not a NIMBY issue), and Doug McMillon seems to be working hard to make its workers’ lives better… Read more »
Dr. Stephen Needel
BrainTrust

Price is certainly the driver for lovers. If customer service is the hater problem, then fixing customer service is only part of the problem — letting the world know about it will be critical. It does Walmart no good to fix something people who don’t go there never find out about. Fixing educational opportunities, advancement opportunities and base pay is fine, but that’s not customer service — that’s employee relations. And employee relations improvements do not always translate into customer service improvements. Lots of people would take jobs at Walmart these days — pick the ones who get the idea of customer service and let go those that don’t. I’m a weekly Walmart shopper and lots of their employees get it.

Charles Dimov
BrainTrust

Dig deeper into the demographics. Although the Walmart customer averages an income of $56,000, they need to know whether there is a difference between the household incomes of the detractors and the champions. Are they catering to each group? Possibly not.

The high income households might be more likely to shop online (see Prime’s household income). If that’s the case, Walmart is still at a disadvantage. Online they have a long way to go before they have caught up to Amazon. However, this is going to be a long term fix — no quick and easys here.

Art Suriano
BrainTrust
I don’t know that this is a fair comparison. Walmart, although it has a strong web presence, is a brick-and-mortar retailer and Amazon although it has gone into a variety of brick-and-mortar businesses, is an online retailer. Walmart’s core customer goes to stores to seek, find, touch and purchase whereas Amazon customers look at the picture, read the description and click to buy. There are many differences between these two shopping experiences. The Walmart shoppes choose to go to a store and deal with the inconveniences like parking, waiting in line at the register and when necessary trying to find an associate to help them. Yet, they find enjoyment visiting a physical store. Moreover, Walmart continues to make great strides in meeting those challenges. The shopper who prefers Amazon is interested primarily in convenience followed by price. They have no interest in driving to a store to buy what they can easily find online at Amazon. Also they are content with taking a chance buying an item they haven’t seen. As competition increases with other… Read more »
Neil Saunders
BrainTrust

Walmart offers a low-price, value-for money, convenient shopping experience. While such functionality may not generate lots of love, it does deliver what many people want – which is why Walmart is the world’s largest retailer. Moreover, Walmart’s exposure to more functional categories like grocery – which many dislike shopping for – also hampers its ability to create strong brand affinity.

That said, Walmart is working much harder to broaden its appeal. The refurbishment of stores, the introduction of new brands, the addition of new online services, and so on are all helping to improve customer perceptions.

Georganne Bender
BrainTrust

I think that people love to say they hate Walmart, but they shop there anyway.

Neil Saunders
BrainTrust

Spot on! How people respond in a survey doesn’t always reflect their behavior on the ground!

Mohamed Amer
BrainTrust

Price and customer service are markers for getting great value for your hard-earned money and the desire for personalized service in a post mass-retail world.

Walmart’s brand imagery and history tap deeply into the value proposition frame held by most consumers. In the past couple of years, Walmart has been working on supplementing its brand image with one that speaks to innovation, convenience, and increasingly frictionless commerce. It takes years to establish a new frame in the mind of consumers. As long as Walmart stays the course and continues to innovate while adhering to its roots of low prices, the company has a more than reasonable chance to cross the chasm.

Laura Davis-Taylor
BrainTrust
I shared this study when Lee first published it because it’s an important one. Walmart is such a polarizing brand — on the one hand, it’s a island for many of the small town “desert” communities where decent accessibility to stores isn’t always an option. And of course there’s price — no denying that the pricing is good. However, from an experience perspective, it can be one of the worst out there. I don’t care how innovative and creative they are at corporate, the fact is that most every one that I go into is awful to shop. Long lines, often sullen employees, frenetic floor plan, wobbly carts … even the POS is spotty. And I live in a big metro community, where you’d imagine that there would be extra care based on volume and demographics, People put up with it for the price, but for how long? Until there’s another option. I really want them to get it together. But they have GOT to care more about the store experience. Not in their innovation… Read more »
Richard J. George, Ph.D.
BrainTrust

I believe some of the haters go way back to Walmart’s expansion into a variety of formats, including food, back in the mid-’90s. At that time Walmart was viewed as the destroyer of town centers as we know them. Ironically, it is customers who put retailers out of business, not retailers. Nonetheless, Walmart battled these perceptions. At the same time another group labeled Walmart as anti-union which brought on another boycott by pro-union factions. Still a third group, perhaps best described by demographics, perceived Walmart as not simply low price but also low quality in its stores and services. For a time, Target’s “cheap chic” flourished in this environment.

Going forward, the number of initiatives noted in the article, will ameliorate some of the “haters.” However, Walmart needs to avoid trying to be all things to all people. While attempting to spread a more friendly net, the company should not ignore the slice of America who likes Walmart for what it stands for.

Cathy Hotka
BrainTrust

Some of us have a real problem with Walmart being so heavily subsidized by U.S. taxpayers, who cover the food stamps so many Walmart employees need to survive. That said, Amazon just soaked up some pretty impressive taxpayer dollars too in its publicity-stunt “search” for a new HQ.

Ryan Mathews
BrainTrust

The simple explanation is that Walmart touches more lives than Amazon and, while Amazon is still an “opt in” for most shoppers in the physical space, across much of America Walmart is more of a forced choice — at least for lower income shoppers, and a lot of people don’t like forced choices. Now, that said, there are a lot of things Walmart could improve on — like service levels. But my guess is that improved service levels might attract more shoppers, but not move the “haters” needle all that much.

Ricardo Belmar
BrainTrust

We’re talking about very different customer sets and Walmart’s current store format simply cannot appeal to all types of shoppers. Amazon is less limited here with their online experience and their stores are just not at all chasing the same customer as a Walmart. Walmart’s new town center concept is a good start, but they may be better served continuing to focus on the acquisition of varied brands to appeal to that higher demographic that seems to have the brand haters. It’s not clear to me from the data shown in the article if this is the case, but perhaps a deeper dive would illustrate where the focus needs to be and what new formats Walmart needs to try to generate that appeal.

Ed Rosenbaum
BrainTrust

There is an expression and I paraphrase: you can have price or you can have quality. Which would you prefer? Walmart does give us low pricing. But at what cost? Customer service is average to weak in most stores. The staff looks at you as if you are not there. Eye contact is poor which shows training to be poor. Shelves are not filled after the morning traffic; and can remain that way throughout the day in some locations. The aprons they wear say service in some form of wording. But the delivery is weak. Until Walmart understands that the customer wants to be acknowledged by more than a person at the door checking the bags you bring in; the scores they receive will continue to show they are liked by some and disliked by the same number of others. Low price does not equate to high quality.

Doug Garnett
BrainTrust

Certainly Walmart can cross the divide to more consumers — they did to my family. Starting as “haters,” we’re not Walmart enthusiasts now but we shop there when there’s good reason to.

And based on Byron Sharp’s work (How Brands Grow) on the Law of Double Jeopardy, they must get the opposition to warm up. Brand growth and market leadership comes from getting more and more light shoppers. And when you do the right things to get those, those who already shop with you will also spend more.

That said, it’s no surprise their strength (price) is their weakness. My experience of Walmart is they clutter high and low quality goods into mediocre displays. For bargain shoppers, that’s more acceptable.

Rather than focus on customer service, I think they need to straighten out their products and shelves most.

Evan Snively
BrainTrust

Loyalty is often looked at as a “preference,” but preference is a privilege that deteriorates when when necessity is the driver of purchasing decisions. Walmart has secured the loyalty of many because of their combination of satisfying the mercenary need of cost — which is weighted heavily by many of Walmarts core champions — with the convenience of both their locations and all encompassing product offerings. It’s a value prop that very few retailers can deliver on.
Not to say that Walmart can’t win over some of its “haters” but those haters have more choices available to them, so its gains will be hard fought.

Kai Clarke
BrainTrust

No, Walmart is not taking the right steps to bring its perception into better balance with Amazon’s or other premier retailers. To do this, Walmart needs to focus on its number one complaint: customer service. Oddly enough, it was the first concern of Sam Walton (who created the “greeter” concept at the front door of his stores). Yet it is the weakest part of the current Walmart model, despite having a “greeter” still at the front door. Walmart needs to focus on customer service, making their customers happy, maximizing the customer experience in the store and after the shopping experience, and focusing on this at the core of their current model. This will turn their haters into lovers — listen to their customers and Walmart will only get better.

Jennifer McDermott
BrainTrust

Hating a brand and choosing not to shop at its stores are two different things. Walmart’s value proposition has been built largely around price rather than customer experience, and it’s entirely possible that many of the “haters” are still active shoppers, they just resent the need. In which case, is it even important to get to the bottom of why this group has negative associations? I think Walmart should focus more on understanding the reasons why people love them rather than flipping the haters, many of whom are probably dropping dollars there (albeit, begrudgingly) anyway.

Glenn Cantor
Guest
29 days 5 hours ago

It is ironic to read this article this morning. Over the weekend, I purchased a digital picture frame online. I first went to Walmart’s site with the thought that I could pick it up at my local store. The online reviews were limited, but the frame that I would have purchased would not be available for pick-up in the store until Wednesday. I then checked Amazon Prime. They had better quality frames for less than that Walmart, but my decision was based on delivery. Prime promised to deliver it on Monday, two days earlier. I bought it from Amazon Prime.

Rich Kizer
BrainTrust

After reading this article, I reflected on Sam Walton and the incredible move he made in the retailing industry. Initially, as a Ben Franklin variety store owner where self service was the norm, I think that set the platform for the giant Walmarts he was to open. In some ways it still remains the same — the greeter (at Sam’s insistence), plenty of shopping carts and aisles of products. Walmart’s largest challenge today is transforming that original platform and turning the store into an environment with a bit more service. I think this is evidenced by their moves recently to allow associates to be armed with smartphones, etc., to help all customers more rapidly and efficiently. This turn is a tremendous and delicate task.

Ken Morris
BrainTrust

Walmart lovers are driven based on the perception of everyday low prices and feel that they always get the best price at Walmart. The “haters” don’t like the fact that when Walmart opens a store in town, it hurts independent operators and often causes them to close. Haters also don’t like Walmart’s labor practices. I suspect that most of the haters are also higher income consumers that feel that the products at Walmart are lower in quality.

OK, enough Walmart bashing. That said, Walmart is changing and they are focused on improving their labor rates and adding more services to help their employees. It may be slower than we like, but they are trying. They are also acquiring more premium brands and expanding product assortments to attract consumers with higher incomes. Turning haters into lovers doesn’t happen overnight, but Walmart is a doing a lot of the right things.

Camille P. Schuster, PhD.
BrainTrust

Walmart has identified the price-sensitive family shopper as a target and does amazingly well with that target. Much of the reason behind experimenting with new store formats and innovations is aimed at other target markets. That has the potential of turning away loyal customers so Walmart has to be careful with that strategy. To lure other markets Walmart needs to decide whether they can cater to those markets with bright, well-lit, spacious aisles, a variety of choices within brands and categories, really good customer service, AND still be profitable. If not, stop trying to go after those other target markets and make sure you keep those loyal customers.

John Karolefski
BrainTrust

If Walmart increased prices and invested in better customer service, they would lose core customers, but attract new ones. It would be a zero sum game. So why bother?

Cynthia Holcomb
BrainTrust

The quality of Walmart’s customer service like any other subject is subjective to each of our own world views. That being said, no one likes being treated like a dolt when seeking sales assistance in a massive store. Given the media attention and PR, Walmart has attracted recently in acquiring more upscale brands, brilliant customer service should be at the top of the retailer’s list. Yet in reality, it seems the corporate view is to leverage new shopping technologies as customer service. A technology overdose, replacing the only human interaction touchpoint between Walmart the brand and its customers. A competitive advantage over Amazon.

gordon arnold
Guest
There is no chance for success if you elect to sell to certain customer characteristics. Prospects of all classes, education levels and business prowess can and do require assistance in unfamiliar endeavors. Keeping this in mind, retailers must also subscribe to discover what levels of service and support are required to sell any and all product under consideration for the needs of the public. If this need can not be met with sufficient profit margin it is better to pass on the opportunity until vendors provide solution sales assistance to meet profit taking needs. Where this becomes more difficult is in the complex commodities mix. Technology, food and vitamin supplements and over the counter medicines are only a few categories where assistance is more often than not needed. Price selling discount retailers by their nature and intent do not have an obligation to provide much more than location and resupply assistance. They should consider informing the public that if no assistance is necessary then shopping with them will get the best price. Feeling the necessity… Read more »
Ananda Chakravarty
BrainTrust
Many already voiced similar thoughts, but this is really a gentrification question. Think 1% (or maybe a little higher than 1% — but same concept)… Not sure of absolute impact, but clearly, Walmart’s business model is nicely configured to the masses who have lower income, and hence a strong business model. Folks seeking food on their table are hardly thinking about other people’s minimum wages — just their own. Walmart has also been the target of an enormous amount of negative publicity by competitors, the government, and 3rd party NGOs — primarily because they really are the big-dog in the retail market. The highest sales, the most profitability, etc. They’ve moved interestingly in positioning themselves in a better light and shifting some of that “king of the hill” mentality to Amazon, so in market terms, it’s good for them to be more customer conscious. However, the same things happened to IBM, Microsoft, and others when they reigned. It’s quite interesting that Amazon’s Bezos just came out with a statement saying they’ll eventually go out of… Read more »
Robin Norton
Guest
So much of this article rings true based on what we have seen in the UK. Walmart’s UK subsidiary, Asda, has a highly rational price focussed positioning, to the detriment of emotion-led customer service. This has left the business disproportionately exposed to the rise of Aldi and Lidl in the UK undercutting Asda prices whilst Amazon has made it very easy for UK shoppers to buy from their homes / workplaces / commutes. Walmart is now partially divesting their UK interests, but the same process is unfolding in the US. As a British shopper and category development consultant I have doubts that customer service is the antithesis of low prices; some comments in these threads show Amazon delivering more service for less money. I believe caring about your shopper costs nothing, saying “good morning” / “thank you” and smiling is free, keeping a store clean and clutter-free is simply a cost of selling volume, building emotion into your marketing campaigns should be a given. From what I see in the UK: if you want to… Read more »
wpDiscuz
Braintrust
"They have GOT to care more about the store experience. Not in their innovation stores -- in all of their stores."
"As long as Walmart stays the course and continues to innovate while adhering to its roots of low prices, the company has a more than reasonable chance to cross the chasm."
"If Walmart increased prices and invested in better customer service, they would lose core customers, but attract new ones. It would be a zero sum game."

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