During Walmart’s fourth-quarter conference call, Walmart U.S. president and CEO Bill Simon said the company will pursue a four-point plan to improve its performance in existing stores. The first order of business -- and something Simon has talked about since he was appointed to his current position last summer -- is a renewed emphasis on everyday low prices, or EDLP.
“Walmart will deliver consistent every day low prices, which is what the Walmart brand stands for, on a basket of goods,” Simon said. (Check out the February cover story in Connecting Northwest Arkansas for more on the EDLP challenge.)
The company also intends to offer the broadest assortment of goods possible and Simon called out newly appointed chief merchandising officer Duncan Mac Naughton as leading the charge on that front. Other changes call for tweaking a store remodeling program to increase efficiency, right-size merchandise categories and minimize disruptions. The last of the four points calls for a continuation of the company’s multichannel strategy to serve shoppers when, where and how they choose.
“We are confident that through these initiatives, as well as the commitment of our 1.4 million associates, we can improve sales throughout the rest of the year,” Simon said. “And, we will make meaningful progress on new store growth, as we add supercenters and expand our store format portfolio.”
The strategies he described are not exactly new. Some, such as the EDLP emphasis and broad assortment, are at the core of what made Walmart successful to begin with so Walmart is simply dedicating itself to those concepts. Others, such as improving the efficiency of the remodeling process to minimize the cost and disruption, are sort of common sense ideas the company should have been pursuing anyway as part of a continuous improvement philosophy. The last point about being a multichannel operator is also a well established strategy in place since the dawn of the Site-to-Store program.
While not exactly new, perhaps Walmart will be more effective in its execution and more desirable results will follow. To be sure, it took Walmart a long time to form a special bond with shoppers who trusted the company as a destination for consistently low prices on a broad assortment of merchandise. Now that trust has been betrayed to a certain extent, and with some shopper segments it is difficult to forecast how long it will take to regain shoppers and then capture a larger share of wallet. It is an uphill battle to be sure, and once again reinforces that old retail expression about how it is far easier to retain and existing customer than attract a new one.