Wal-Mart has no problem selling toothpaste or soap or other personal care and household items — 84 percent of the U.S. population visits one of the retailer's stores each year.
John Fleming, Wal-Mart's chief marketing officer and executive vice president, said the challenge is that "we don't necessarily have the right product or the right experience in other categories to engage them more fully."
Now the world's largest retailer is drilling down to become engaging. "Segmentation — this is where we are moving toward," Fleming said.
Wal-Mart is moving from a "one-size-fits-all" orientation to focusing on different customer segments to tailor stores so they better serve the segments, which means the products and the store image are changing.
Fleming said during his presentation that the company is intensifying efforts to better focus on Hispanics, Baby Boomers and higher-income venues such as Plano, Tex., as well as inner-city locations such as Chicago.
Three years ago, Fleming was recruited from running walmart.com, based in San Francisco, to Wal-Mart headquarters in Bentonville, Ark., and given the task of building a marketing team, developing customer insights and setting new directions. Wal-Mart has reported softening same-store sales, and the performance has been particularly soft in apparel, including the Metro 7 line. In addition, the company continues to come under fire for labor practices, and community groups have been seeking to restrict Wal-Mart's expansion.
Against that difficult backdrop, the company is learning to reshape its image, as well as its assortments to answer critics and elevate the business.
Sustainability has become a corporate mantra. Fleming said that Wal-Mart is determined to become more environmentally friendly, with the products it sells and the energy it uses in order to generate less waste. The strategy will help draw a greater number of shoppers to the store, particularly younger consumers, and also can reduce costs for Wal-Mart, he said.
"Sustainability is a real issue,'' Fleming explained. "We have partnered with groups we never thought of before to better understand what things we can do to lower costs and build a more sustainable business model. This is very consistent with the way Sam Walton built the business. Every opportunity we had to build the sustainability business model lowered the cost of doing business."
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