New Study Shows Wal-Mart’s Appeal Continues to Decline with Consumers

Results indicate new ad campaign unlikely to help

For Immediate Release
Thursday, November 08, 2007

Washington, DC --- On Monday, November 12, Wal-Mart Watch will release polling data showing that Wal-Mart’s appeal with both its current and potential customers continues to decline.

Key indicators provide evidence that Wal-Mart CEO Lee Scott’s leadership team is making significant strategic mistakes which negatively affect the company’s business. October same-store sales plummeted to a paltry increase of 0.4% despite the company’s early holiday campaign price cuts and gimmicky antics to attempt to attract customers to its stores, in advance of next week’s third quarter results.

A critical finding shows that Wal-Mart’s current customers along with its necessary growth segments are becoming increasingly less inclined to shop at Wal-Mart because of the company’s business practices.

“Clearly the company’s business practices are negatively affecting Wal-Mart’s business, even among its current customers,” says David Nassar, Executive Director of Wal-Mart Watch. “This is about poor management; no public relations campaign is going to fix Wal-Mart.”

For example, Wal-Mart is staking its future success in a new advertising campaign, which survey results indicate consumers do not believe is credible.  Consumers overwhelmingly reject the notion that shopping at Wal-Mart saves the average family who shops there enough money to provide any benefits resembling the ads’ claims. Only four percent of survey respondents believe Wal-Mart’s annual savings claims.

The company’s new advertising campaign won’t help Wal-Mart regain the ground it is losing with existing and potential customers.  On the contrary, it appears that Wal-Mart’s customers neither believe that they are saving more nor living better because of Wal-Mart.

The full release of information on Monday will include an analysis of a national survey completed on October 30th, as well as focus group discussions with consumers representing key growth segments for Wal-Mart.  The study is a follow-up to a previous survey in April and takes a closer look at factors that may be affecting Wal-Mart’s weakening sales.