Wal-Mart Stumbles Onto The Runway
Wal-Mart’s initial foray into the world of high fashion was panned by critics and questioned by analysts who have doubts about the discount retailer’s new upscale marketing strategy. Some excerpts from the poor reviews:
“I think Wal-Mart would be best advised to take care of its existing customers as opposed to reaching up and trying to curry the favor of a more affluent customer,” said Robert Buchanan, an analyst with A.G. Edwards & Sons. [Los Angeles Times, 8/25/05]
“The fact is, most Wal-Mart customers are not Vogue readers, and most Vogue readers are not Wal-Mart customers,” said Richard Guha, principal of the New England Consulting Group in Westport, Conn. “The danger is the Vogue reader will reject it and the Wal-Mart shopper won’t even see it.” [Minneapolis Star-Tribune, 8/25/05]
Wal-Mart doesn’t have to go couture — but since it wants to change, here’s a thought. Shoppers love a bargain, but a growing number of them are turned off by the issues behind the smiley face. Saving a few bucks is becoming a tough compromise… America doesn’t need a fancier Wal-Mart. We just need the one we have to be a little more aware. [San Antonio Express-News, 8/25/05]
Investment analysts remain skeptical that Wal-Mart can overcome years of appeals based on low prices alone. “Wal-Mart has made no bones about being the place small-town America shops,” said Patricia Edwards, a Seattle-based money manager with Wentworth, Hauser & Violich. “They’re looking to totally change that, and that’s a tall order.” [Bloomberg News, 8/24/05]
The verdict is still out on Wal-Mart’s jazzed up new strategy. “Concept advertising is infinitely more glamorous, but will it reflect the real culture that is Wal-Mart, will it allow Wal-Mart to stand out from everyone else?” asks Randy Curtis, Wal-Mart’s former head of consumer communication who left two years ago to start his own consulting company. [Wall Street Journal, 8/25/05]
But reaching broader audiences will be “like turning around the Queen Mary” for Wal-Mart, said Robert Passikoff, the president of Brand Keys, a brand-consulting company. Edwards added that the challenge for Wal-Mart will be to win over wealthier shoppers without alienating its traditional customers. “They absolutely could stub their toes doing this,” Edwards said. [Bloomberg News, 8/25/05]
We’re still waiting for the “new” Wal-Mart to pick up on other hot marketplace trends like affordable health care, pay equity, and living wages for employees. They may be updating their fashion style for the 21st century, but their policies on gender pay equity and employee health care remain stuck in the 1970s, with polyester leisure suits and platform shoes.
Posted by Nu Wexler on Thursday, August 25, 2005
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COMMENTS
There is no way in hell that I am trading in a good company like Banana Republic for some trashy store that can’t pay its employees enough money for health care! Get a clue—the real trend is treating your employees and communities well!
Stephaine in Royal Oak, MI
Thursday, August 25 at 02:36 PM
Stephanie,
Does Banana Republic give its’ employees fully paid company health insurance? Or are they like most mall-based retail stores which make their employees dress up for minimum wage, 10% employee discount and 26 hours per week? I always laugh when I go into Kauffman’s or Macy’s and they have these snotty women dressed like high priced prostitutes trying to sell my girlfriend some crappy makeup. These women are earning minimum wage and no benefits but you would think they are earning $50,000 a day for a modeling job, based on their attitudes. You know what I say when they piss me off: “You have a negative attitude. That’s the reason you’re selling this crap instead of buying it.” They get upset, I think, but I could care less. I hate fakes.
I got off my original point, which was to ask what exactly Banana Republic, home of the $200 sweater, does for the community? What do they do for their employees? Surely, Stephanie, you can tell me.
Just because the store is nice and in a nice mall and it sells nice expensive items and is staffed by attractive, well-dressed young women does not mean those women are well-compensated.
Nick in Wheeling
Thursday, August 25 at 03:41 PM
Nick - ughh.
T&A;sells, that’s Walmart’s sell point - free - easy -
That only goes so far.
Subliminal’s rule. The truth absolutely rules. This isn’t about clothing - it’s about America - I think.
Anonymous in
Thursday, August 25 at 03:49 PM
Some facts for you to consider, Nick:
Wal-Mart pays its hourly employees $9.68, which is $2.60 less than the hourly wages of all retail workers.
Wal-Mart spends $3,500 year per employee for health care coverage. The average for retail is $4,800 and $5,600 for all employees.
The “snotty women dressed like high priced prostitutes” are part of Vogue’s target audience and Wal-Mart is spending over $800,000 dollars this year to reach them.
You can rant all day about shopping malls and expensive sweaters but Wal-Mart still treats its employees like SH*T.
Ben in Raleigh, NC
Thursday, August 25 at 03:56 PM
Oh, yes, I almost forgot: in all the confusion here, nobody replied to my original point, which was “what do mall stores like Banana Republic pay their employees, how many hours per week do they give them, do they provide benefits and do they force their employees to purchase their clothing.” I think that was my point.
In typical fashion, whenever a point is uncomfortable and cannot be challenged with facts, we get rhetoric here. Why can’t someone tell me what Banana Republic pays it’s snotty employees? Is that so hard?
Nick in Wheeling
Friday, August 26 at 07:04 AM
Hey Nick, been lurking here awhile and always enjoy your posts. Don’t let these morons get to you. I love how people get so worked up over a retailer. I guess some peoples lives are so pathetic they make it their mission in life to try and bring down Wal-Mart. Because all of the worlds current problems can be traced to Bentonville, AR.
Jonathan in South Central BA
Friday, August 26 at 02:22 PM
I love it when people get so worked up when defending a retailer. Only morons would defend a company that makes billions of dollars in profit and doesn’t even care about its workers. No one is saying all of the worlds problems can be traced to Wal-Mart but would it really kill their execs to set a proper business model? Why do you have to cut corners when you are making billions of dollars a year?
Randy in Providence, RI
Friday, August 26 at 03:25 PM
Rook to queens four.
This is an egghead debate - you think it’s about Walmart - most know it’s about America.
Now - I’m going to re-read your second post, having expected your third post.
I’m going to re-read your second post - having expected sincerity - and then re-read your third post; having anticipated either profanity or an insult. Check mate?
Anonymous in
Saturday, August 27 at 12:53 AM
Would someone please tell Nick how much a Banana Republic Employee makes!
....long pause....
“anybody?”
....another long pause....
Sorry Nick
Vinnie in Point Pleasant, NJ
Saturday, August 27 at 11:04 AM
i don’t know about banana republic but i do know that the hot topic in madison’s east and west towne malls pays a whopping 7.50 and their employees get 24 hrs a wk max. i know that the supercenter walmart in baraboo starts people at between 6.50 and 8.00 an hour (guess which end of that spectrum you’re at when you got tits?) i live in a smalltown area, i work in wisconsin dells(WHOO HOO) and within 50 miles i can choose between 6 different supercenters, 3 regular discount stores, and oh yeah, there’s a couple abandoned buildings in the area also when they decide after a couple years to build another supercenter...walmart SUCKS and i’m so damn poor i can’t help but shop there...i find myself there buying more stuff i don’t need on almost a daily basis...Matt Stone and Trey Parker were GENIUS when they made the South Park episode titled “Something Walmart This Way Comes”!! :)
Bender in Reedsburg, WI
Saturday, August 27 at 02:29 PM
I know, South Park did do an episode spotlighting Wal-Fart. That episode saw an Wal-Fart knockoff try to kill South Park business including an general store. The episode had everything when it concerns the store from the NW Arkansas location to the Mirror that is usually posted in the Customer Service area of every store. South Park tried to do everything when it comes to wrecking the store including fire, but the store just grows. In the end, the episode includes the secret of killing Wal-Mart. It will be reran on September 7 at 10 PM.
Jessy in Mandan, ND
Sunday, August 28 at 07:01 PM
Ben,
If you feel you are worth more than $9.68/hour then don’t settle for less!!! Prove that you’re worth it and go find employment elsewhere.
Christa in Trumansburg, NY
Sunday, August 28 at 10:08 PM
Maybe they can build a Walmart down the street from the Coast Guard Station.
How do you think that would sell.
Would your’ councilmembers sell (out)?
:).
Anonymous in
Sunday, August 28 at 10:57 PM
Ben,
I think you need to study economics before you rant. If I am understanding you correctly, you are saying that the more you spend on health care, the better the health care. I’m here to tell you that we, as a nation, spend FAR more on health care, both in sheer dollars and per capita, than any nation in the world yet our health care is rated near the bottom of the developed nations. That’s right: we spend more and get less. How? Through welfare bums, illegal immigrants and other leeches getting free care. Through hundreds of billions in government red tape. Through doctors artificially raising costs to drive up their incomes. Through the cost of developing new wonder drugs and then having to pay billions in a class action lawsuit. I could go on and on. The point is, you don’t always get what you pay for. By your calculations, Wal-Mart spends more than $4 billion per year just on employee health care. Assuming that the next largest retail/grocery company has 300,000 employees and spends the maximum average of $5,600 per employee, that works out to less than $1.7 billion spent on health insurance. I’m not in that field but surely an additional $2.3 billion per year can buy you some cost savings. Don’t you think?
As to the “average” retail wage being more than $2 an hour higher than Wal-Mart’s I say this: how much of that extra $2 goes to the union. Even if you pay $50 per month to the union, more than 15% of the difference goes straight to union dues. I’m sure that union guys pay more than that but I am trying to be fair. I will tell you that unionized department managers at Kroger in my area are earning less than $12 an hour. And they are department managers. I think they start at $10.66 an hour or something. Of course, Kroger lost more than $100 million last year so I don’t really care what they pay. They are doing a disservice to their stockholders, customers and employees by not managing for the future OR the present. They lose money, therefore they are losers.
That is why Wal-Mart continues to dominate the landscape.
Nick in Wheeling
Monday, August 29 at 12:36 PM
Nick, why so hostile to unions? Have you been seriously harmed by one? And why the thinly veiled misogyny? Those women behind the counter selling your girlfriend makeup are tryng to earn a paycheck just like the rest of us.
And who pays for your healthcare?
Della Schwartz in Skokie, IL
Monday, August 29 at 01:06 PM
Della,
The only people who are not harmed by unions are the union bureaucrats. The rest of us, union members included, pay for these higher artificial costs.
As to the women behind the counter, let me tell you. I respect anyone who works for a living. I cannot respect stuck up females (or males for that matter) acting as if they are doing me a favor by allowing me to shop in their store. They look down their noses at you and they talk in these annoying accents as if they are so much better than you. Condescending is a good word to use here. They should remember, and I have often reminded them, you are no better than the customers you serve.
As for my health care, my employer pays 50% of the premium and I pay 50% of the premium. I have no deductible but I do have a 10% co-pay up to $4,000 per year max. It covers pretty much everything but it is certainly not dirt cheap. Yet, I buy it. I’d be an idiot not to.
Nick in Wheeling
Monday, August 29 at 03:32 PM
Nick -
When you speak of unions, you act as though this country would be the same had they never existed. What do you think employers would pay if they were never forced to raise their wages? As little as possible. When workers began to organize, they risked physical harm and death to do so. This was because the alternative was starvation and poverty. Much of the prosperity of this country is owed to unions.
A union is a group of workers banded together to bargain collectively. Anyone can start a union, and dues are not required.
Further, Nick why do you repeatedly insist that you do not work for Wal-Mart, when we can all see you doing their work?
Ashamed?
Colin in
Monday, August 29 at 04:18 PM
To Nick:
You said “Just because the store is nice and in a nice mall and it sells nice expensive items and is staffed by attractive, well-dressed young women does not mean those women are well-compensated.”
The well-dressed young women would not even be there if they were not well compensated.
To Colin in: None of the country’s prosperity is owed to unions. Prosperity is created through effort. Work. Unions only succeed when they refuse to work (lazy lay-abouts expecting to be paid more because they are doing less).
justice in
Monday, August 29 at 05:57 PM
My comments are addressed to Nick, since he is so hell bent on defending Wal-mart. He has to be on Wal-mart’s payroll, or in serious need of a reality check.
Wal-mart is bad for small town America. Sure, you can buy a can of hair spray for 99 cents. So What? What Wal-Mart principals know and the average Wal-Mart customer is completely ignorant of is that you cannot SAVE your way to financial security. Let’s suppose you saved 50% on everything you bought by buying at Walmart (you won’t, but let’s be aggressive.) If you are making minimum wage you are STILL BROKE. If people spent as much time trying to figure out a way to make more money, be successful, or start a small business that will help them and their town as they did trying to save 10 cents a lbs. on hamburger EVERYBODY would be better off because we would have a stronger economy and not a bunch of damn walmart whineys.
A community composed of interdependent businesses loyal to each other is the basis for a healthy local economy, NOT some international uber company sucking all the profit out of a community using low-priced cheap Chinese imports to drive the competition out of business.
Illegal immigrant labor, mostly part time employees with NO health benefits, discrimination against women in pay scales...the list goes on.
I will shop at Target, I will shop at my local mechanic, I will buy from farmers I know and trust, ANYTHING to keep my money fom going to the Waltons.
Personal case in point, Sylacauga/Childersburg, AL area once had a thriving local economy. All the businesses traded with each other and a large percentage of the products and services bought and sold were produced/provided locally and the profits STAYED in the community. Walmart moves in and begins to TELL the local producers what they will charge for what they produce. They could either play ball or be undercut when Walmart brought stuff in and sold it cheaper than they could produce it for.
Walmart is not simply a company, it is a militaristic marketing machine not just trying to be successful, but to eliminate ALL competition.
Tim Singleton in Birmingham, AL
Tuesday, August 30 at 08:07 AM
Tim
Using your logic, we can never have winners and losers in the world because it is unfair. I am fairly certain that your next step is socialism. I do not work for Wal-Mart. I merely wish to defend the capitalist system and the freedom of choice. Yes, Wal-Mart allows for freedom of choice. You can choose not to shop there. Do you really think Target is any better? They pay their employees worse-FACT. They do not offer health insurance to all employees-FACT. They hurt small businesses-FACT. They source from overseas-FACT. So, why would you shop at Target and not at Wal-Mart?
Let’s assume that you have 25 businesses in your town that are small mom and pops, have been around for 100 years and are all involved in price fixing (that’s what you mean by loyal to each other). Now Wal-Mart comes along and opens a store. Let’s assume there are 10,000 people in your town. Now, if those 10,000 people are loyal to the 25 local businesses, how can Wal-Mart put them out of business? THEY CAN’T!!!!!! What really happens is that people are held hostage by mom and pop. I will give you an example. We have local hardware stores around here. They are generally open M-F from 8:00 am to 6:00 pm, at the latest. If you go in to buy something, they generally have to order it because it is not in stock. The price is very high. The merchandise is no better than a chain store item. The return policy is hell. And if you want someone to help you, you have to apologize for interrupting the sales people’s conversation. Well, a new Lowe’s is coming in down the street. They will be open 7 days at good hours. They will have a broad selection of quality merchandise at low prices. They will have a friendly and helpful staff and a fair return policy. Why then, should I continue to give my business to the local store? Does it make sense? That is why Wal-Mart puts Mom and Pop out. Of course, downtowns were dying after WWII when interstates, suburbs and malls began to spring up. Wal-Mart didn’t open its first store until 1962. K-Mart and Target’s parent companies were already established and they were very large at that point. It was progress, not Wal-Mart, that killed the small town. Progress that includes convenience, selection, low prices and friendly customer service, things most mom and pops have yet to learn.
All of my statements are backed up by historical evidence.
Nick in Wheeling
Tuesday, August 30 at 08:59 AM
Wal-mart does offer health insurance to part timers. Unfortunately, they have to wait two years to get it.
Let’s be honest. I can buy lego’s for my kids at target ot lego’s for my kids at wal-mart and pay less. What would you do? I happen to know that EVERYTHING an hourly employee does for Wal-Mart, they get paid for. There is ABSOLUTELY no working “off the Clock” for hourly Wal-mart people.
Hey, Wal-Mart has some savage buisness practices. But how come Fortune 500 calls them a most admired company? There is truth to everybodies argument. Do you want low prices? That means low overhead, wages benefits what have you. Before you start bashing Wal_amrt, go work for one for a while.
John in Madison, Wi
Tuesday, September 27 at 09:07 PM
YOU ALL ARE RETARTED !!!!!
? in
Sunday, October 09 at 04:27 PM
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