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Wal-Mart

Introduction
Wal-Mart, a leading biggest global retail company. Wal-Mart's Sam Walton opened the first
discount store in Rogers Arkansas back in 1962, and 47 years later, Wal-Mart operates
11,526 stores in 28 countries. Each week, more than 260 million customers and members
visit our more than 11,500 retail units in 28 countries and e-commerce websites in 11
countries. We employ 2.2 million associates globally, including approximately 1.4 million in
the United States. Wal-Mart is one of the largest private employers in the U.S. and Canada.
For the fiscal year ended January 31, 2015, Wal-Mart increased net sales by 1.9% to $482.2
billion and returned $7.2 billion to shareholders through dividends and share repurchases.
Wal-Mart ranked first on the 2014 Fortune 500 list of the worlds largest companies by
revenue. Wal-Mart employs over 2.2 million people worldwide, making them one of the
largest private employers in both the US and Canada, and the largest private employer in
Mexico. Even in the midst of a recession it's estimated that Wal-Mart stores' retail market
share has risen markedly and they are seeing sales gains for 2009. Wal-Mart has a dramatic
story of success from its humble beginnings to its transformation into an industry leader; one
can only wonder what the future holds for this corporate giant.
One aspect of Wal-Mart's structure that has given them a competitive edge is their efficiency
in logistics. Beginning in the early 1970's, Wal-Mart utilized a warehouse distribution
strategy facilitating bulk purchasing and streamlined distribution processes enabling them to
dramatically minimize distribution costs. Today Wal-Mart has more than 147 distribution
centers with the average facility serving 75-100 stores. Their truck fleet travels about 800
million miles a year and they move over 5.5 billion cases of products. A Wal-Mart
distribution center can have up to twelve miles of conveyor belts and about 500 - 1,000
employees.
A unique feature of Wal-Mart retailing is that it is virtually recession proof. In times of
economic downturn, consumers flock to discount retailers. During the recession of 1974-75,
sales expanded 42 percent; in the 1981-82 recessions, sales grew 44 percent; and the
recession of 1990s, sales grew 30 percent. As such, Wal-Mart is not affected by economic
downturns like many other retailers. Wal-Mart has obtained a distinct competitive advantage
by targeting small, rural communities, which leads to lower operating cost .this advantage
result from lower rents, moderate wages. And the absence of unionization. In addition, real
estate is significantly cheaper, and smaller communities have a loyal and productive
workforce. Although the store location strategy was innovative, several other factors have

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Wal-Mart

played a strong role in valuating Wal-Mart the top of the retail mountain. For instance, Mr.
Sams Management practices were even more trend setting than his store location strategy.
For example employees are referred to as employees; instead they are called associates .Other
factors contributing to Wal-Mart success include rigorous cost control, an excellent
distribution Network, and technological advantage Wal-Mart proudly moves up in Fortunes
list of the top ten Americas Most admired Companies in 200, rising to fifth on the list.

History

Sam Walton opened the first store in 1962 in Rogers, Arkansas.


Within 5 years there were 25 Wal-Mart stores earning total revenue of $12.6 million in sales.
In 1972 Wal-Mart was listed in the NYSE.
In 1991, Wal-Mart became an international company when we opened a Sam's Club

near Mexico City. Just two years later, Wal-Mart International was created.
In 2005 Wal-Mart incorporated sustainability in its business under their CEO H Lee Scott Jr.
In August 2007, Wal-Mart and Bharti Enterprises announced an agreement to establish Bharti

Wal-Mart Private Limited.


Mike Duke succeeded Lee Scott as president and chief executive officer on February 1, 2009.
Presently 7,800 stores and club locations in 15 markets employ more than 2 million

associates, serving more than 176 million customers a year


Wal-Marts major international operations are in the following markets:

Argentina

Brazil

Canada

Central

Chile

China

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Wal-Mart

India

Japan

Mexico

Puerto Rico

UK

Timeline Logo

1962 1964 Sam Walton names his new stores WALMART.


The Wal-Mart name was presented in just about any font/style
available to the printer.

1964 1981 Also known as the "Frontier Font Logo,


"this was the first official and consistently used logo.

1968-1981 The Discount City mark was used in print advertising,


on the uniforms/smocks, in-store signing, and other things.
However, it was never used as building signage or in an annual report.

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1981 1992 The logo was updated again in 1981.

1992 2008 The star was adopted as an update to the existing


logo in early 1992.

2008 New logo adopted by Wal-Mart Stores U.S.

Currently Wal-Mart:
We are a global retailer committed to growing our company by improving the standard of
living for our customers and serving communities around the world. We earn the trust of our
customers everyday by providing a broad assortment of quality merchandise and services at
everyday low prices while fostering a culture that rewards and embraces mutual respect,
integrity and diversity. Today, Wal-Mart Stores, Inc. is the worlds largest retailer with more
than 1.8 million associates worldwide and nearly 6,500 stores and wholesale clubs across 15
countries. The "most admired retailer" according to FORTUNE magazine has just completed
one of the best years in its history: Wal-Mart generated more than $312.4 billion in global
revenue in the fiscal year ended January31, 2006, establishing a new record and an increase
of 9.5 percent. The company earned almost$11.2 billion in net income in fiscal 2005.Guided
by founder Sam Waltons passion for customer satisfaction and Every Day Low Prices, WalMarts four retail divisions offer a wide variety of quality merchandise to consumers around
the world.

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Wal-Mart Discount Stores


Wal-Mart now has more than 1,470 discount stores in the United States offering a variety
of quality, value-priced general merchandise and a pleasant, convenient shopping experience.
The stores feature wide, clean, brightly lit aisles and shelves stocked with quality items
including: family apparel, automotive products, health and beauty aids, home
furnishings, electronics, hardware, toys, sporting goods, lawn and garden items, pet supplies,
jewelry, and housewares.

Wal-Mart Supercenters
Developed in 1988 to meet the growing demand for one-stop family shopping, Wal-Mart
Super centers today number more than 1,430 nationwide and most are open 24 hours a day
for the ultimate in convenience. Supercenters save customers time and money by combining
full grocery lines and general merchandise under one roof at Wal-Marts signature Every Day
Low Prices. In addition to general merchandise, Supercenters feature bakery goods, deli
foods, frozen foods, meat and dairy products, and fresh produce. Supercenters also are home
to many specialty shops such as vision centers, Tire & Lube Expresses, Radio Grill
restaurants, portrait studios and one-hour photo centers, hair salons, banks, and employment
agencies.

Sam's Club
Sam's Club is a chain of warehouse clubs which sell groceries and general merchandise, often
in large quantities. Sam's Club stores are "membership" stores and most customers buy
annual memberships. However, non-members can make purchases either by buying a one-day
membership or paying a surcharge based on the price of the purchase. Some locations
also sell gasoline. The first Sam's Club opened in 1983 in Midwest City, Oklahoma
Under the name "Sam's Wholesale Club". Sam's has found a niche market in recent years as a
supplier to small businesses. All Sam's Club stores are open early hours exclusively for
business members and their old slogan was "We're in Business for Small Business." Their
current slogan is "Savings Made Simple" as Sam's Club attempts to attract a more diverse
member

base.

In

March

2009,

the

company

announced

that it plans

to enter the electronic medical records business by offeringa software package to physicians
in small practices for $25,000. Wal-Mart is partnering with Dell and eClinicalWorks.com in
this new venture. According to Wal-Mart's 2007 Annual Report, Sam's Club's sales during
2007 were $42 billion, or 12.1% of Wal-Mart's total 2007 sales.

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As of December 2009, there were 605Sam's Clubs in the United States. Wal-Mart also
operates more than 100 international Sams Clubs in Brazil, China, Mexico, and Puerto Rico.

Wal-Mart International
Wal-Mart's international operations currently comprise 2,980 stores in 14 countries outside
the United States. According to Wal-Mart's 2006 Annual Report, the International division
accounted for about 20.1% of sales. There are wholly owned operations in Argentina, Brazil,
Canada, Puerto Rico (although PR is part of the US, the company's operations there are
managed through its international division), and the UK. With 1.8 million employees
worldwide, the company is the largest private employer in the US and Mexico, and one of the
largest in Canada. Wal-Mart has operated in Canada since its acquisition of 122 stores
comprising the Wool co division of Woolworth Canada, Inc. in 1994.As of October 31, 2008,
it operates 310locations, employing 77,500 Canadians, with a local home office in
Mississauga, Ontario. Wal-Mart Canada's first three Supercenters (spelled asin Canadian
English) opened on November 8, 2006, in Hamilton, London, and Aurora, Ontario. As of
October 31, 2008, there are 39 Wal-Mart Supercenters in Canada. In 2008, Wal-Mart named
German retailing veteran Stephan Fanderl as the president of Wal-Mart Emerging MarketsEast in an effort to, "explore retail business opportunities in Russia and neighboring markets."
The market is estimated to be worth more than$140 billion per year in food sales alone. In
January 2009, the company acquired a controlling interest in the largest grocer in Chile,
Distribucion y Servicio D&S SAIn February 2010, the company agreed to buy Vudu, a
Silicon Valley start-up whose three-year-old online movie service is being built into an
increasing number of televisions and Blu-ray players. Terms of the acquisition were not
disclosed, but a person briefed on the deal said the price for the company, which raised $60
million in capital, was over $100 million.

Online Wal-Mart retailing


Wal-Mart online (www.wal-mart.com) launched on January 1, 2000 offers the well-known
products found in traditional stores plus additional products offered only to online users.
Virtual shelves are always well stocked with the latest software, videos, music, home
products, office furniture, toys, tools, and collectibles. Similarly Sams club online
(www.samsclub.com) offer similar products found in Sams clubs, and the clubs members
still enjoy discounted prices. Recently Wal-Mart formed a new partnership with the internet
venture - capital firm Accel partners. The new venture is based in Palo Alto, California, and
its financial results will be consolidated into Wal-Mart stores, Inc. is the majority shareholder,

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furthermore the separate company will have its own management team and board of
directors. In February of 1998 florists transworld delivery, Inc. announced that it had
partnered with Wal-Mart to launch an online flower shop in conjunction with Wal-Mart
website. The partnership allows FTD to sell holiday and every day arrangements, flowers and
food items and other gift-giving solutions. FTD provides merchandising support and fulfills
floral orders through its international affiliation network of more than 5400 FTD florists.
Regarding the safety of credit card system they utilize the secure sockets laser system. The
security system applies high tech encryption technology to ensure that credit card numbers
are kept away from desirable fraud artists.

Mission Statement
Wal-Mart mission statement, the company looks to its founder, Sam Walton for a
company" purpose":
If we work together, well lower the cost of living for everyonewell Mart's
advertised mission statement and its advertising slogan are the same:
"We save people money so they can live better."
In addition to this give the world and opportunity to see what its like to save and have a
better life.

Vision Statement
Quality goods at low prices, responsible manufacturing, and opportunities for growth. Were
dedicated to excellence in every part of our business.

Marketing Strategies
Wal-Mart is one of the biggest companies in the world that has over 8,500 stores in 15
different countries with 55 different company names. They are also considered the biggest
retailer in the world and the largest grocery retailer in the United States. Wal-Mart actively
uses TV, press and radio ads to market itself, its low prices and new stores. Its US division is
also home to the biggest in store TV network in the world. Increasingly, in the face of more
vocal criticism, Wal-Mart is using its marketing initiatives to defend its reputation.
It is incredible to think of exactly how big this company is, but they couldnt have gotten this
big without the proper marketing strategies, so lets go over some of their tactics and see if
we can learn a thing or two.

Low Prices

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The first thing anyone notices when going into a Wal-Mart is the incredibly low prices they
offer their products for. This in itself helps with their marketing strategy because everyone is
always looking for the lowest price and it can usually be found at Wal-Mart. Once someone
sees an advertisement about the low prices and actually visits a store or their website, they
will become a loyal customer since they will be able to find the best deals all year long.
Not all of us are going to be able to provide products and services at the lowest prices
possible like Wal-Mart does, but if you cant seem to compete with your competitions prices,
try making your products or services a more quality purchase. By offering small additions to
your customers purchase, it will give them that extra push to pay more. You can also brand
your products as being superior to that of your competitors, giving consumers a reason to
choose your company. If you end up promising them a superior product, make sure it is,
because if your customers start to become unhappy, it will then become known that your
company is unreliable.

Easily Accessible
One of the main things about Wal-Mart is that they are extremely accessible, they have
thousands of stores all around the world and if you dont live near one, you could always use
their internet store and buy from there. Being this accessible makes marketing to people
much easier since the customer doesnt need to work hard to do business with them.
Customers are also able to contact them 24 hours a day, which helps with the customer
satisfaction aspect of the whole business.
Every business can become too accessible, even if you only have an internet store. Being
accessible doesnt really mean customers can physically visit you, it just means that no matter
what they have a way to do business with you and contact your company. If you own a
physical store and cant stay open 24 hours a day, give your customers an option to place an
order for a particular item through your website and also give them good contact information
so they can either talk to a live person or leave a message to get contacted at a later time.
This will help your marketing efforts because no matter what if someone is interested in
doing business with you, they always have a way to do it. The last thing you want is for
someone to see your advertisement and try to contact you, only to be unsuccessful and move
to the next company.

Appeal to As Many People as Possible


Wal-Mart offers products of all types, from beauty products, home cleaning products, toys,
electronics, to even groceries. Anyone could find something they have a use for there, which

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gives

them

much

broader

appeal

to

all

personality

types.

Although most of us wont be providing as many product types as Wal-Mart, it is good to


keep in mind that by expanding your business and putting new products or services for sale,
you can increase your overall customer base. If you keep your company only focused on a
certain type of product, you could be risking your business because if that product doesnt
sell, then you have no other product types to offer which results in a failed business.

Social Media Campaigns


All large companies, including Wal-Mart, have focused a lot of resources on social media
campaigns this is because it is one of the best types of marketing due to its consistent results.
There are many different social media strategies that are out there, but the two that have
proven to be the best would be blogging and video sharing and then linking those content
posts with your social networking profiles. Video sharing sites such as YouTube, get millions
of hits every day, so why not try to direct some of those people to your company? If you
make a relevant and quality video that will appeal to your target audience and at the same
time promote your products or services, you could see your revenues spike due to the amount
of sales. We have all heard the term going viral which basically means a video is liked a lot
and shared throughout the social networking community. It might be a little hard to get
started if youre not familiar with making videos, but once you get the hang of it you will
notice great results. If you have a decent marketing budget, you could also hire a company to
make the videos for you.
Blogging is going to be the other very successful way market and attract new consumers. The
same strategy that is used for video sharing is the same for blogging. Make quality and
relevant content that appeal to your target audience. Blogging is a much easier way to start
out your social media marketing campaign because it doesnt have to cost anything and it will
introduce you to the whole idea. Starting a blog only takes a few minutes and you could be
creating content in no time! Once you have gotten used to making the content you want to
share, start posting links to them on all of your social networking profiles and you will start
seeing more and more people becoming interested and interacting with your company.

Market Segmentation
Market segmentation refers to the manner in which a accompany groups or divides its
customers into several homogenous groups. This is mainly achieved through carrying out a
thorough research aimed at identifying trends and preferences of among certain homogenous
groups of customers. To Wal-Mart, market segmentation is applied to determine where to

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open a retail outlet and the kind of items to stock in the store. Wal-Mart uses two main types
of market segmentation. The first type is geographical, which is ranked as one of the oldest
method of segmentation. Geographical segmentation involves grouping customers based on
their physical location. For example, Wal-Mart does not stock snow shovels in its cities like
San Diego because there is hardly snowfall in that side of the country (Capon, Noel, &
James, 2011). The second type of segmentation is based on the age of customers in a certain
region. In this type of segmentation, the company stocks its outlets to meet the tastes of its
customers depending on their age.

Walmart net sales fiscal year 2014 was about $279.4B. In this year share of Apparel was 7%,
home was7%, Hardliners was 9%, Health and Wellness was about 105, Entertainment was
11% and Grocery share was about 56%. It shows that Walmart major sales occurs due to
grocery products. And apparel and Home capture least sales about 7%.

Demographic Segmentation:
In demographic segmentation, the market is divided into groups on the basis of variables
such as age, gender, income, occupation etc.; these demographic variables are so popular with
marketers so that they are often associated with the consumers needs and wants.
Segmentation variables are easily measurable. Here are the demographic variables have been
used to segment markets. Walmart product categorizes its target on the following criteria.
Age: Walmart product are used every age people like baby, young and old people.
Gender: Walmart product is for everyone from which male are 44.3% and female are 55
.7%...

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Income: annual income of Walmart customers


Less than $15000

12.1%

$15000 to $24999

12.8%

$25000 to $34999

14.4%

$35000 to $44999

17.4%

$45000 to $55999

22.3%

Up to

21%

$55000

Occupation: Students, working professionals, athletes, health enthusiasts

Psychographic Segmentation:
Psychographic segmentation buyers are divided on following ways:

Lifestyle: middle class upper class


Personality: hardworking, health conscious.
Benefits: Quality, low prices
User status: regular user
Usage rate: regular
Loyalty status: regular Loyal
Readiness stage: intending to buy
Attitude toward product: good quality with low prices

Geographic Segmentation:
Geographic segmentation is done using the spatial location to segment the market. In
geographic segmentation there are different schemes for the different geographical units such
as states, regions, cities. Markets are mainly divided into the rural and urban areas. The
Geographical variables have been used to segment markets in following ways:

Area: Walmart product itself to semi urban and urban India as that is their major

consumer base
City
Region: Distribution is constant across urban area

Regional Segmentation

Regional
Segmentation

Argenti
na

Canada

India

China

Japan

UK

Mexico

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Demographic

Walmart targets 25-34 years women who are educated HS diploma and have $30,00-$39,000
income level in south. Target Company targets 25-34 years women consumers who are
educated with $150,000 income level in west. CVS targets youth 18-24 years consumers both
men and women who are highly educated with $150,000 in Northeast.

Target Market
A target market refers to a section of customers that a business establishment plans to sell its
products or services to. The main aim or goal of every business establishment is to sell its
products or services to the target market at a profit. Every marketing strategy of any company
must begin with a well-defined target market. The performance or success of any product in
the market is mainly determined by the four variables of marketing mix namely product,
promotion, place, and price. A target market can be grouped or classified based on five main
aspects namely product, demographics, geography, customer behaviour, and customer
attitudes or psychograph. Since its inception, the main marketing strategy for Wal-Mart has
remained as offering products to customers at low prices with an aim of achieving volume
sales at a reduced profit margin. This strategy proved very popular with consumers because it
appeared like a crusade for the poor and the middle class in the society.
As stated earlier in the paper, a companys target market comprises of a group of potential
customers that it plans to sell its products to. For any company to be successful in todays
competitive environment, it should anticipate the needs of its potential customer and work
towards meeting those needs. There is a huge difference between identifying the needs of the
target customers and putting in effort to make sure that those needs are met. Wal-Marts main

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policy is to help its customers to save money by ensuring that it offers the best prices in the
market. Wal-Mart reaches out to the lower, middle class and the poor in the society who
strive to meet their daily needs. This category of the market is the largest in the US and many
other countries where it operates. This policy has made it a very popular name in the US. It
also confirms why the company has a retail outlet in every city in the country (Ferrell &
Hartline, 2008). The poor and the middle class in the society forms a large part of the
American population, thus enabling the company to perform reasonably well even in places
where its competitors find hard to base their operations. This has helped it to claim a huge
market share regions where it has dominated. Many shoppers in America rank Wal-Mart as
the retail outlet with the lowest prices on any item. This has helped it win the confidence and
loyalty of many customers overtime. For example, Wal-Mart sells Aveeno body wash at less
than $5 while other stores sell it for more than $5.
Wal-Mart Market Segmentation
Market segmentation refers to the manner in which a accompany groups or divides its
customers into several homogenous groups. This is mainly achieved through carrying out a
thorough research aimed at identifying trends and preferences of among certain homogenous
groups of customers. To Wal-Mart, market segmentation is applied to determine where to
open a retail outlet and the kind of items to stock in the store. Wal-Mart uses two main types
of market segmentation. The first type is geographical, which is ranked as one of the oldest
method of segmentation. Geographical segmentation involves grouping customers based on
their physical location. For example, Wal-Mart does not stock snow shovels in its cities like
San Diego because there is hardly snowfall in that side of the country (Capon, Noel, &
James, 2011). The second type of segmentation is based on the age of customers in a certain
region. In this type of segmentation, the company stocks its outlets to meet the tastes of its
customers depending on their age.
Target Market Selection Process
As a company, Wal-Mart employs five major processes to identify its target market as well as

the type of segmentation variables to use.


The first step used by the company in identifying its target market is identifying the most
applicable targeting strategy. This involves analysing characteristics like the companys
resources, market characteristics, objectives of the organization and product attributes. It

includes undifferentiated strategy, differentiated strategy and concentrated strategy.


The second step involves determining the segmentation strategy to use. Segmentation
variables involve the behaviours of the target customers that are used to divide them into

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groups. Some of the variables that Wal-Mart uses in segmenting its customers are

demographic, geographic, psychographic and behaviouristic variables.


The third step of the Target Market Selection Process at Wal-Mart is developing profiles of
market segments. This is important because it helps in describing similarities in a certain
segment as well as explaining the differences between people in different segments.
Developing market segment profiles is important because its helps a company understand

how it can use the available resources to serve its target customers.
The fourth step involved in the Target Market Selection Process is the evaluation of the
relevant market segments. This step involves sales estimates, competitive assessments and

cost estimates (Gilman & McDaniel, 2009).


The final step of the Target Market Selection Process is identifying a specific target market.
The first and key consideration in this stage is determining whether there exist enough
differences in the needs of target customers to neceIn case the needs of the identified
customers are homogenous, the best approach that a company should use is the
undifferentiated approach.
In case the needs of the target customers are heterogeneous, then the company needs to
consider using one or more markets. It is worth noting that a company should consider
whether it has the necessary financial resources, employee expertise, managerial skills, and
facilities to enter and compete effectively in the identified market segments. This is because
every market segment has its unique advantages and challenges that require certain resources
to ensure that the company succeed.

Competitors strategies
Wal-Mart faces increasing competition from local, regional, national and international
retailers.
Target Strategy (Worldwide Competitor)
Target corporation focus on higher quality and makes innovative products.
Big Bazar Strategy (Local/Regional Competitor)
WEDNESDAY BAZAAR Big Bazaar introduced the Wednesday Bazaar concept and
promoted it as Hafte Ka Sabse Sasta Din. It was mainly to draw customers to the stores on
Wednesdays, when least number of customers is observed. According to the chain, the aim of
the concept is "to give homemakers the power to save the most and even the stores in the city
don a fresh look to make customers feel that it is their day.

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Here some competitors of Wal-Mart is given above. The first is big Bazar, it is categorized in
merchandizing, its target segments are middle class, upper middle class and lower upper
class. It is topped rated competitor of Walmart in India. The second is Pantaloons, it is
categorized for apparels and accessories, its target segments in India are upper middle class
and lower upper class. Its ratings in India is about 50%. Star Bazar is the third main
competitor of Wal-Mart in India, its categorized for merchandizing, it targets upper middle
class and lower upper class consumers, and its rating is about 50% in India. On the other
hand Spencers, More, D, mart are categorized for merchandise and targets middle/upper
middle class consumers, its rating in india is about 25%. Next one is shoppers stop and Life
style they both are categorized in apparels and accessories and targets mostly upper class and
its rating in India is about 75%.

Strategic Positioning
Strategic positioning is a key component of a successful business strategy. Wal-Marts
general strategy is to place itself as the low-cost leader when compared to competitors. The
company applies this strategy in every business pursuit. To give an example, the company has
partnered with True Connect to offer a low-cost Wi-Fi alternative. The pre-paid service

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allows users unwilling, or unable, to purchase monthly data plans for mobile devices another
alternative for obtaining mobile broadband.
This focused low-cost leadership is just the most recent example of Wal-Marts drive to
expand into product and service markets. Other examples include entries into the soft drink
industry (Sam's Choice colas), pet food market (Ol' Roy dog food), and perishables (Great
Value brand). Each product's purpose is to offer a lower cost alternative to other brands in the
same industry/market.

Pricing Strategies
Wal-Mart uses an Everyday Low Price (EDLP) pricing strategy. In fact Everyday Low
Price advertisements are frequently seen in Wal-Mart stores. The objective of this pricing
strategy is to attract large populations of customers. This strategy supports Wal-Marts
generic business strategy, which is cost leadership. The company has low costs and low
prices. However, the large sales volume enables Wal-Mart to generate profits.
Wal-Mart's Aggressive Pricing

Mission to provide a wide variety of high quality, branded and unbranded products at the

lowest possible price.


Efforts to procure products at the lowest prices possible from manufacturers.
Wal-Mart's products are usually priced 20% lower than those of its competitors
Generate more profits due to larger volumes.
Surplus generated was reinvested in building facilities(modern equipment, latest technology)

of an efficient scale
Wal-Mart imposes a strict control on its overhead costs
The stores are set up in large buildings, while ensuring that the rent paid was minimal.

4Ps
Product
Wal-Marts product is its retail service. In general, retail firms are service businesses. WalMarts sales personnel are trained to effectively assist shoppers in finding the goods they
need. Convenience is achieved because the Wal-Mart offers a wide array of goods in its stores
Wal-Mart has much lower focus on product quality since they need to keep their prices the
lowest in order to keep their customer base. Wal-Mart wants to focus on the lower section on
society, older people and people who only want the lowest price. They keep prices low by

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sheer volumes of sales. A Best Price store spans over 50,000 Sq. ft. offering more than 5,000
items, across product categories such as:

Consumer Packaged Goods (Food & Non Food)

General Merchandise

Household Electronics

Appliances

Fresh (Fruits, Vegetables, Poultry, Mutton, Fish)

Dairy (Milk and Milk Products)

Price
Wal-Mart is the ideal discount retailer. Their entire business model is based on low prices.
They manage this by having a large footprint and access to a massive customer base. They
use this as leverage to get the lowest possible prices from the vendors by purchasing volume.
Wal-Mart uses an Everyday Low Price (EDLP) pricing strategy. In fact Everyday Low
Price advertisements are frequently seen in Wal-Mart stores. The objective of this pricing
strategy is to attract large populations of customers. The company has low costs and low
prices. However, the large sales volume enables Wal-Mart to generate profits.

Place
Wal-Mart low price strategy works only due to its high volumes and being able to reach every
nook and corner. With over 4000 Wal-Mart stores around the US they are the best placed to
do this. Wal-Mart uses the intensive distribution strategy or intensive distribution channel
design. In this strategy, Wal-Mart stores offer the same variety of goods, while the same
employee roles and responsibilities apply to each store. Wal-Mart does not try to be a high
end store, most stores are designed the same way and the customer is enticed with lower
prices. Due to being so big Wal-Mart has faced the ire of many communities in the USA.

Promotion
Wal-Mart also spends a lot of money on making sure brand recognition is high with TV and
other media ads. Wal-Marts promotional mix is composed of advertisements, sales
promotions, personal selling, and public relations. The company advertises on newspapers
and websites. Wal-Mart uses sales promotions in the form of special deals and discounts.

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Personal selling happens at Wal-Mart stores, where sales personnel persuade customers to try
new products or package deals. In terms of public relations, the company uses press releases
to inform customers and investors about policies, programs and strategies. Wal-Mart also
occasionally sponsors charity programs.

SWOT Analysis
The SWOT analysis of Wal-Mart shows that the company can have higher long-term success
potential through aggressive global expansion, especially in retail markets in developing
countries.

Wal-Marts Strengths (Internal Forces)


In this part of the SWOT analysis, Wal-Marts strengths are all related to the size of its
business. These strengths enable the company to withstand threats despite its weaknesses.
Wal-Marts strengths for further global growth are:

Global organizational size


Wal-Marts global organizational size gives the firm deep pockets to fund growth and
expansion.

Global supply chain


The global supply chain also provides business resilience from market-specific risks.

High efficiency of supply chain


In addition, Wal-Marts supply chain has high efficiency because of advanced technologies
for monitoring and controlling the movement of products from suppliers to its stores.

Marketing Aspect
Wal-Mart emphasis is on its brand image "everyday low prices and good quality of products"
when marketing by using different channels. Wal-Mart is become superior to their
competitors by using their expertise core competencies. Wal-Mart involving local

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communities and they are sponsoring local teams. This is a major competitive advantage WalMart has over the competitors. Wal-Mart has excellent logistic system. They create the ideal
one - stop shopping experience. Because of collection of its wide product range customers
can do one stop shopping products, the typical customer can go into any Wal-Mart and walk
out without having to stop at another store for anything that they could need.

Management Aspect
Wal-Mart's policies and practices are designed to ensure an environment that is wide-ranging
and reasonable. . Wal-Mart has strong community - based initiatives. Corporate structure of
Wal-Mart is very well rounded and managed with core values like respect for the individual,
striving for excellence and service to their customers. The management of Wal-Mart is the
backbone to the entire firm and these core values have propelled them to the top of their
industry. They have allowed Wal-Mart to be world's largest company.

Human Resource Aspect


Wal-Mart has more than 2.1 million associates or employees worldwide. They provide
continuous training to their workforce to run successful business.

Research and development


Wal-Mart's innovation keeps it a leading retailer in retail industry as it is regularly turning out
new patents/proprietary technology. Development and innovation are high at Wal-Mart with
regard to their products/services which give ultimate profit.

Wal-Marts Weaknesses (Internal Forces)


Wal-Marts weaknesses impose challenges on the firms ability to withstand threats also
identified in this SWOT analysis. These weaknesses are directly related to the companys
generic strategy. Wal-Mart uses the cost leadership generic strategy, which leads to the
following weaknesses:

Thin profit margins

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Thin profit margins are a typical effect of using the cost leadership strategy. Because WalMart minimizes selling prices, it also needs to minimize profit margins and rely more on sales
volume.

Easily copied business model


The cost leadership strategy also makes Wal-Marts business model easy to copy. The firm
does not have significant competitive differentiators, except for its business size.

Marketing Aspect
One of the biggest marketing weaknesses seems from Wal-Mart awareness raising to expand
into new market nationally and internationally. There are many areas across the US tried to
block the introduction of Wal-Mart because of the economic impact like local stores, traffic
and environmental problem. Wal-Mart has a damaged reputation because when they move
into a new location they end up "forcing" for opening new stores which is unethical at all.

Management Aspect:
Wal-Mart is lacking equality demand which is not ethical decision for Wal-Mart to be
making. They are really hurting their corporate image by maintaining this position in market.
There is also lack of union. Because of perception of treating employees poorly, Wal-Mart
does not have any union involvement. There is biggest problem is lack of job security for
associates.

Human Resource Aspect:


Wal-Mart is non-unionized firm. Wal-Mart employees start at lower wages than unionized
corporations. Wal-Mart pays low wages to their employees which affect their standard of
living. Wal-Mart is presently involved in class action suit behalf of formal and current female
employees across its US retails and warehouses.

Opportunities for Wal-Mart (External Forces)


Wal-Marts opportunities are mainly about expansion and improving business practices.
These opportunities are linked to the global economic situation. Also, the human resources

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situation in the organization presents issues that are actually opportunities for the firm to
improve. In this portion of the SWOT analysis, Wal-Marts opportunities are:

Expansion in developing countries


Wal-Marts opportunity to expand in developing countries is based on their high-growth
economic condition.

Improvement in human resource practices


The opportunities on HR practices directly relate to the criticisms on the companys
employment practices.

Improvement in quality standards


Wal-Marts opportunity to improve quality standards addresses consumers concerns on the
health effects of using low-cost and sometimes low-quality products.

Economic Aspect
Wal-Mart offers all products under private labels. Expanding brand portfolio, Wal-Mart
incurs lower operational costs, high quality product and gaining higher margin. Wal-Mart has
tremendous opportunities for future business in expanding consumer market by acquisition,
merge with, or form strategic alliances with other global retailers.

Social, cultural, demographic and environmental Aspect


To fulfill obligation or responsibilities towards social and culture, Wal-Mart announced plans
to open in - store clinic 'The Clinic at Wal-Mart' to be connect with local hospitals in
February 2008. The company could leverage rising health care spending in the US to boost
revenues of its pharmacies and health clinics.

Political, Legal and Government Aspect


Asian market is virtually untapped by the retail world in many extent. It gives huge
opportunities to expand business with unlimited and unexpected potential growth and profits.

Technological Aspect

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Nowadays, online shopping is growing stage. To take advantage and experience of internet
shopping, customers can easily purchase products by receives friendly site designs, efficient
order fulfillment, fast delivery and response. It can help Wal-Mart to make huge revenue.

Threats Facing Wal-Mart (External Forces)


The threats to Wal-Marts business are linked to the retail market condition and the changes
on consumer perceptions about the products they buy. These factors should compel the
company to make some competitive strategic changes. In the context of this SWOT analysis,
the threats to Wal-Mart are:

Aggressive competition
The healthy lifestyle trend is a threat and an opportunity. It threatens Wal-Marts business
because most of the companys goods are not healthful, organic or natural. It is an
opportunity for Wal-Mart to improve its quality standards. However, this factor is more of a
threat because the firm currently does not prioritize healthful products in its stores.

Healthy lifestyle trend


Aggressive competition is a threat because other large retailers could use aggressive
marketing and strategies to capture some of Wal-Marts customers.

Economic, social, demographic and environmental Aspect


Wal-Mart is facing stiff competition from a large number of companies in the retail market
worldwide and local stores. Intense competition could adversely affect the revenues and
profitability of Wal-Mart. They face opposition and resistance from communities by local and
international market like small retailer in US and opposition of shopkeepers and retailers on
introduction of Wal-Mart in India. Growing opposition to opening new stores from local
communities and entry into international markets is likely to hold back expansion plans of
Wal-Mart.

Political, Legal and Governmental Aspect


Being a global retailer, each firm threatens by political problem in the countries where they
operate in by nation's industrial and general laws, rules and regulations. Like Chinese
government does not take kindly open to their country to foreign establishments.

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Technological
As technological change and advances, products being sold today are gone tomorrow; this
provides fewer products to sell and continuous change with technology update. Thus, WalMart has to update technology as per current demand and upgrading requires high
investment.

PEST Analysis
Political
Wal-Mart is currently operates its operation worldwide. In this operation Wal-Mart need to
follow certain rules and regulation of host countries. In 2009, international operations
generated 27.2% of Wal-Mart's net sales. They are facing big challenge from Chinese
government and forced to Wal-Mart to acquire its operation with local firm. Political
condition includes political instability, economic condition, currency regulation, legal and
regulation constrains, intellectual property rights, tax system etc. Wal-Mart's international
operations have greater impact of host countries law and regulation like Indian government
open door for foreign investment to operate business acquire with local firm. For E.g.,
currently, Wal-Mart acquired with Bharati Airtel - leading Telecommunication Company and
open new retail store in year 2009 and shut their operation in Germany and South Korea.

Economic
The decision is related to Wal-Mart's recently announced plans to moderate growth of U.S.
super centers as part of leveraging capital resources through a strategy designed to improve
returns and sales within U.S. stores.Wal-Mart facing high inflation rate and currency
devaluations. In US, Wal-Mart facing challenge of high interest rate, higher fuel and energy
cost, inflation, higher level of unemployment, higher consumer debt level, unavailability of
consumer credit, higher tax rates, economic slowdown and other economic factor could
adversely affect consume demand of the product or service offering by Wal-Mart.

Social
Wal-Mart's international operation should operate according to local culture of host countries.
It includes population growth, age distribution, career attitude and emphasis on safety. Trend
of host countries affect demand of Wal-Mart's products and services. People looking for ONE
STOP service come to Wal-Mart a first choice in US.

Technological

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Wal-Mart incorporates the latest MIS systems to vertically integrate with suppliers and
customers. Nowadays, technology has a greater impact on any business. This factors includes
ecological and environment aspects. Wal-Mart need to invest in Research & Development
activities, automation, technology incentives and respond the rate of technological change for
remain in competitive market and No. 1 retailer. Wal-Mart's spend huge amount behind
continuous new advanced technology upgrade program.

CRM (Customer Relationship Management)


Wal-Mart Stores, Inc. (NYSE: WMT) helps people around the world save money and live
better anytime and anywhere in retail stores, online, and through their mobile devices.
Each week, more than 200 million customers and members visit our 10,700 stores under 69
banners in 27 countries and e-commerce websites in 10 countries. With fiscal year 2013 sales
of approximately $466 billion, Wal-Mart employs more than 2.2 million associates
worldwide. Wal-Mart continues to be a leader in sustainability, corporate philanthropy and
employment opportunity. It also operates under its own name in Puerto Rico. Wal-Mart
operates in Mexico as Walmex, in the United Kingdom as Asda ("Asda Wal-Mart" in some
branches), in Japan as Seiyu, and in India as Best Price. It has wholly owned operations in
Argentina, Brazil, and Canada. Wal-Mart's investments outside North America have had
mixed results: its operations in the United Kingdom, South America and China are highly
successful, while it was forced to pull out of Germany and South Korea when ventures there
were unsuccessful.
Relationship Marketing has four Key Components

It has to be personalized. Personalization can come in the form of a highly targeted direct
mail piece, a phone call or email. Obviously the handshake and a smile illustrated by Wal-

Mart greeters also work well in personalizing the relationship.


It has to be targeted. Wal-Mart invests money in maintaining relationships with existing
customers. By targeting this group, Wal-Mart establishes long-term relationships with their
most loyal shoppers. Targeting customers through programs that reward loyalty can result in

big returns over the life of the customer.


It has to be meaningful. Your marketing message has to connect in an emotional way to
establish a lasting relationship. If the Wal-Mart greeter did not look you in the eye while

saying "hello," the greeting would not have a lasting impact.


It should be interactive. Many Wal-Mart greeters learn the names of frequent shoppers.
Walmart.com, a subsidiary of Wal-Mart Stores Inc., does a great job of asking for the

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relationship online by providing special offers to those who supply their email address. It is
important to make relationship marketing interactive so you can hear feedback, determine
what is working and what is not.

Market Share
Market share of Wal-Mart in 2006 was about $308.95 B, $344.76 B in 2007,$373.82 B in
2008,.401.09B in 2009, $404.74B in 2010, $418.5B in 2011, $443.42B in 2012,$465.5B in
2013,473.08B in 2014 and 482.2 was in last year 2015. This graph shows that Walmart sales
is increasing day by day due its effectiveness and efficiency in work field.

CSR (Customer Social Responsibility)

Wal-Mart Stores, Inc. (NYSE: WMT) helps people around the world save money and live
better anytime and anywhere in retail stores, online, and through their mobile devices.
Each week, more than 200 million customers and members visit our 10,700 stores under 69

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banners in 27 countries and e-commerce websites in 10 countries. With fiscal year 2013 sales
of approximately $466 billion, Wal-Mart employs more than 2.2 million associates
worldwide. Wal-Mart continues to be a leader in sustainability, corporate philanthropy and
employment opportunity.

It also operates under its own name in Puerto Rico. Wal-Mart operates in Mexico as Walmex,
in the United Kingdom as Asda ("Asda Wal-Mart" in some branches), in Japan as Seiyu, and
in India as Best Price. It has wholly owned operations in Argentina, Brazil, and Canada. WalMart's investments outside North America have had mixed results: its operations in the
United Kingdom, South America and China are highly successful, while it was forced to pull
out of Germany and South Korea when ventures there were unsuccessful.

The Wal-Mart Corporation is a multi-billion dollar low-cost retail organization, consisting of


6400 stores and 1.8 million sales associates worldwide. Wal-Marts influence on the retail
world and the enormity of their corporate size is unparalleled.

Wal-Mart promises her customers "Always low prices. Always!" and upholds this motto by
providing low prices to her customers and high return on investment to her stockholders.

One way that Wal-Mart has managed to maintain a competitive edge over other low cost
retail giants and provide low prices is by cutting wages and by not offering too many
company benefits to their employees. Full-time employee working at Wal-Mart only make $8
an hour, while only 45% of the workers can afford to be covered by health insurance. WalMart also increases part time employees from 20 per cent to 40 per cent so that they do not
have to cover all of their employees for health insurance.

Although Wal-Mart may not provide excellent benefits to her employees, it successfully
performs as a legitimate business operating in a capitalistic society. In a free market Wal-Mart
has a direct responsibility to her primary stockholders rather than the employees of a
company.

Conclusion
In conclusion, Wal-Mart is the number one retailer in the United States and is at the top of
the Fortune 500 listing. Wal-Mart operates in many countries world-wide and is moving into
new countries every year. Wal-Mart is also expanding as a retailer. They have expanded into
many other sectors of the marketplace, including groceries, gas stations, electronics, and auto
maintenance. Each year, Wal-Mart finds new ways to grow and offer more services to their

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customers. Each year, the number of people who have a stake in Wal-Mart also grows. Each
year, more claims are made against Wal-Mart by the unions and other businesses that have
been forced out of business. Wal-Mart is often able to uncut many other local industries and
more and more local businesses are shutting down when Wal-Mart moves into town. The
unions are filing more court claims against Wal-Mart because they encourage their workers
not to join unions. As a result of Wal-Mart's ever growing size and variety of services they
offer, their public affairs department is going to become more and more important. And as the
animosity against Wal-Mart becomes more widespread, here and in foreign countries, WalMart is going to have to work harder to maintain their good reputation. Wal-Mart's foundation
will become increasingly more important for giving things back to the community.
In order for Wal-Mart to stay at the top of their game and follow the company strategy and
achieve their key policy goals, they are going to have deal better with their stake holders and
make sure they guard their reputation well.

Wal-Mart is more oriented towards making profits by cutting down costs


Has little concern about its employees
One stop shop, low priced and diverse services makes Wal-Mart a tough competitor
Has slowed down its growth.

Recommendation

Introducing higher and equal incentives for both genders.


Continue trade with china to reduce cost.
Discovering new geographical opportunities.
Being more concerned about employees.

Workshops, Training & Seminars


The HR department, emphasizing that Wal-Mart is serious about its strategic initiatives to
promote and hire more women to managerial and supervisory positions. From the data and
research collected, it appears that the key people in charge of promoting and hiring of staff
are male. In order to change their perspectives and beliefs regarding women in the workforce,
we believe it is imperative that these people realize the benefits, experience and knowledge
that women can bring to the organization. We realize it will be a gradual and at times
seemingly slow process, but many psychology studies (Bentham, Veltman, & Vebrugge,
2004) confirm that a change of beliefs is possible via avenues such as sensitivity training and
workshops.

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Diversity Task Force


The creation of a Womens Group which actively promotes supports and brings attention to
womens rights in the company will help increase equality. Other organizations have
implemented diversity task forces to great success, such as Napa Valley College, Kodak,
Wells Fargo and AT&T (Cole, 2007) - who report that turnover has decreased whilst staff
morale and job satisfaction has increased. The CEO of the Diversity Advisory Board (DAB)
Eric Beresford states that. If a company is willing to say diversity is a business imperative,
then a diversity advisory board [or diversity council] is a terrific way to make that a
reality ...But if diversity is three layers deep in an organization, the diversity council may get
frustrated. But if diversity is a business imperative, then a diversity council can provide
tremendous value."

Clearly posted job openings/promotion opportunities and abolish implied relocation


for Management positions:
Wal-Mart should ensure advertisements for any managerial or supervisory positions are easily
viewable by all staff, and that there are no conditions attached to the job, i.e. Relocation, nonflexible hours, which may result in women being hesitant to apply. The diversity initiatives
have managed to salvage what was left of its reputation and continues to slowly change the
communitys perception of the company for the better. Wal-Mart must also be extremely
diligent when navigating international markets due to cultural differences in human resource
practices. Potentially damaging misunderstandings may occur which will be reported and
hyped up by the media, resulting in a loss of faith, trust and revenue.