Wal-Mart Seduces its Core Customers, but at What Expense?
In his autobiography, Wal-Mart founder Sam Walton wrote, “The secret of successful retailing is to give your customers what they want.”
That’s exactly what Wal-Mart is doing this holiday shopping season. After launching a new fashionable apparel line in September called Metro 7, revenues fell short of Wall Street’s forecasts, leaving the chain’s executives to admit they’ve made some mistakes. Retail analysts said Wal-Mart frightened off its core customers—low-income consumers who frequent the store for everyday low prices.
Well it appears as if Wal-Mart is trying to win over its core group of customers again. It’s knocking back prices early and often and promoting holiday shopping to lure holiday shoppers. Its even promoting heavy discounts on high-end electronics like flat-panel televisions and MP3 players, potentially launching a price war between rivals like Best Buy and Circuit City.
In addition to lowering prices, the company is also promising that it will do whatever it takes to keep shelves stocked and even vowed to keep the heavily sought after T.M.X. Elmo doll on the shelves.
The changes seem to be attracting consumers’ attention. A holiday shopping survey of 1,000 adults by America's Research Group between November 8 and November 10 found that 89 percent planned to shop at Wal-Mart. Some 72 percent planned to go there for electronics.
It appears that Wal-Mart will go out of its way to get customers in the stores this holiday season. The question is when the customers arrive there, will the notorious long lines, slow check-outs, and crowded aisles keep them coming back for more?
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