CASE INCIDENT 1 Sprucing Up Walmart

For more than half a century, Walmart has prided itself on providing value to customers by being

a low-price leader. But the consumer mindset is changing. Now "value" also means convenience,

ease of finding what you want, and the ability to get exactly what you want when you want it.

Nationwide dollar-store chains often have lower prices than Walmart, so that point of

competitive advantage is fading. And thanks to Amazon.com and other online retailers,

consumers can shop from home whenever they like, compare prices, and know immediately

what is available. Contrast this with the experience many Walmart shoppers previously had when

they entered a store?low inventory, disorganized aisles, unhelpful staff, and an overall

depressing atmosphere. The company's online presence was about the same. The site was

difficult to navigate and attempts to search for products were frustrating at best and more often

fruitless. Named Walmart's CEO in 2014, Doug McMillon set out to change this situation. "What

people think about the company is important," he noted. And at the moment, people weren't

thinking about value and low prices when they thought about Walmart. McMillon enacted a

number of changes. First, the company had earned a reputation of treating its store employees

poorly?low wages, few benefits?while profits were in the billions of dollars, so Walmart

announced it would increase its minimum wage. Second, the company asked for and paid more

attention to employee feedback. Recurring issues included the dress code, store music, and even

store temperatures. So clothing rules were relaxed, more variety in music was introduced, and

thermostats were adjusted. The company hopes improving employee morale will translate into a

better experience for customers, thereby changing some of the negative images. Walmart's Web

presence was another target for big changes. Amazon is the store's biggest competitor, and

McMillon wanted to offer customers more items, pickup options, and ways to meet their needs

and demands?for example, an online grocery ordering service. This means a new way of

thinking about marketing and inventory across the board. McMillon was able to see how

consumers have changed not only what they want but also the way they want it? whether from

the hands of happy employees or with the simple click of a mouse. The question remains: Will

his actions be enough to change the way consumers see Walmart?

Questions