‘Made in U.S.A’ labels out on Walmart.com
A couple of years ago, Walmart began a high profile campaign to bring back American manufacturing jobs. While the chain has gotten a lot of credit for its efforts, it took some heat this past summer when it was discovered that some items on its website were tagged with "Made in the U.S.A." logos when they were actually made in other countries. At the time, Walmart blamed the issue on coding errors and said it was taking steps to correct the issue. Now, according to reports, Walmart has removed all the logos following an investigation into the matter by the Federal Trade Commission (FTC).
A letter to the retailer from a staff attorney at the FTC says the agency will not pursue its investigation into whether Walmart was misleading consumers because of actions taken by the retailer. In addition to taking the logos off its site, the company has also agreed to remove:
- Country-of-origin information from product specs, except where required by law
- Claims of U.S. origin claims in product descriptions and titles
Source: corporate.walmart.com
Walmart has also implemented a procedure to identify and remove claims of U.S. origins in ad copy submitted by vendors.
"We are pleased with the FTC’s decision and appreciate its thorough review of our program," said Kory Lundberg, a Walmart spokesperson, in a statement (via Business Insider). "We’re committed to reviewing and strengthening our processes to help ensure customers have a great experience on our website and can find the products and information they are looking for."
- Walmart removes "Made in USA" logos from website after government inquiry – Fortune
- Walmart suddenly removed ‘Made in USA’ labels from its website – Business Insider
- Walmart quietly dropped some of its aggressive ‘made in America’ labeling – Fusion
- Letter to Associate General Counsel Walmart Global E-commerce – Federal Trade Commission
- Will Walmart spark a reshoring movement? – RetailWire
- Walmart continues ‘Made in the USA’ push – RetailWire
Discussion Questions
Will the investigation into Walmart’s “Made in the U.S.A.” labeling in any way undermine it efforts to portray itself as a supporter of American manufacturing? In what ways can Walmart make the U.S.A. connection with its U.S. customers while adhering to its agreement with the FTC?
Poll
BrainTrust
Anne Howe
Principal, Anne Howe Associates
Ed Rosenbaum
CEO, The Customer Service Rainmaker, Rainmaker Solutions
I think most people believe Walmart’s products are made in China. The Made in U.S.A labels seemed like a great idea. With this revelation, it can’t help anyone touting Made in U.S.A as genuine. It looks like a cheap marketing ploy used without authenticity. “Organic” is not far behind.
Given the stream of negative news over the last several years, not least Walmart’s employment practices, this new development may be damaging. In fact, all the more so from the point of view of the difficulties the chain is having in developing sales and traffic.
I’m sure Walmart wants to support American manufacturing. However our economic model of high wages and high taxes makes that difficult. The best way to connect with U.S. customers is to keep hammering the low price message. Walmart did not get to be the largest retailer because customers wanted American made products. They wanted cheap products. Consumers are more concerned with value, not the actual physical location of where things are made. Having American-made products in Walmart is like having a ski resort in Florida, its just too costly due to the environment.
Transparency is one of the ultimate paths to trust. Walmart needs to be mindful that a lack of transparency could have a long-term negative impact. I’m all for retailers sourcing more American made products, and I’m willing to pay a premium for that, so it is a good idea to tag products both online and in stores where it makes sense.
I hope Walmart will continue to support companies with American manufacturing facilities. As Mr. Livingston points out, our model of taxes and wages does not make this easy. Does assembled in America have any legs?
Walmart is Teflon. No matter what the red flag issue is they seem to grin and bear it. The customers do not care. That is the driver for Walmart. They will continue to make grand commitments, not live up to them and still the cash register will ring.
Walmart is the company some people just love to hate. It’s the wages they pay. It’s because they import. It’s because they are hard for local stores to compete with. Any reason will do. When they raise wages it doesn’t make the critics happy — it wasn’t enough. If they try to point to things made in the U.S. — not enough either.
I doubt the claims of “Made in U.S.A” were completely fabricated. I suspect we are talking about things in the gray area; part U.S. and part import.
The PR will be bad and the stock will be under pressure. I don’t think it will cause shorter lines at checkout.
This was such a strong branding move by Walmart, and a terrific opportunity to call attention to the loss of American manufacturing jobs after NAFTA. Let’s hope that Walmart can figure out how to genuinely tout American products.
Anyone with half a brain knows that Walmart is the largest importer of Chinese goods, and makes very good money on their products. This Made in U.S.A labeling problem will go away quickly, and it will be business as usual when Black Friday rolls around and Walmart has another record smashing day. Selling goods made in the U.S. is admirable, and the pricing strategy at Walmart is deep discounts, so it doesn’t fit their marketing plan.
None of us can be all things to all people, but Walmart owns the discount shopper and they know it. Who wouldn’t love to sell products made in the U.S. at the same price as China-made goods? People would be lined up across the street to get in, but it is not going to happen, as our regulations and labor laws make it impossible to do. This will pass quickly as news, and Walmart will finish strong this year as our economy is in shambles, with some exceptions.
I don’t think this will have much impact for the simple reason that few will be aware of it (“Honey, did you check FTC.gov this morning?”), but really, what possible excuse is there for this?
I’ve noticed lately on some Made in China items it now states the city and state where the good was manufactured. I’m a bit curious about the reasons behind this and find it interesting.
As far as the question at hand goes, I’ve always felt Walmart gets an unfair bad rap for its product sourcing. Target, Kohl’s, Macy’s, Kmart, etc. are selling all of the same Made in China items that Walmart sells.
At this point there are too few Made in USA items at any retailer (excluding food) to market the idea. But Walmart has some; more than some of its competitors actually.