Wal-Mart is starting the holiday season in the black with positive third quarter sales, and is banking on its Christmas marketing strategy to keep the registers ringing.
The retail chain reported revenue of $246.9 billion for the nine months ended Oct. 31, a 12% increase over the same period last year and a 5.8% jump in net income to $8.2 billion.
Part of this is due to Wal-Mart’s redefined marketing strategy, Wal-Mart Executive VP/CMO John Fleming said yesterday at the Morgan Stanley Consumer & Retail Conference in New York.
Wal-Mart put an aggressive plan in place to offer customers lower prices than competitors. Beginning Nov. 3, for example, prices on the 100 most popular electronics products dropped 15% to 30%. And in October, prices on the Top 100 toys fell by up to 50%.
The retailer is also improving customer experience with an ongoing project to remodel 1,800 supercenter stores—a blend between grocery and discount stores—that will offer wider aisles and an improved shopping experience, Fleming said.
In addition, the chain has hired a “dream team” to handle market research. Robert Atencio will focus on consumer research, Stephen Quinn on marketing strategy, Julie Roehm, on marketing communication and Santiago Roces store experience. In turn, Wal-Mart will use its findings to drive new product offerings and improve the customer experience.
Wal-Mart wants to “put marketing at the center of the organization,” Fleming said. “We want to build a marketing organization that can shine light on customer insight,” he added.
More than 84% of U.S. households shop at Wal-Mart.
Meanwhile, Wal-Mart is gearing up for the holiday season by injecting Christmas back into its marketing. The new campaign, titled “Be Bright,” includes 17 TV spots and 24 print ads in 55 publications. It launched Nov. 1.
To move merchandise, Bentonville, AK-based Wal-Mart will ramp up the number of store circulars to eight from five last year, each focusing on a specific theme (think last minute gifts and New Year’s resolutions). The retailer already announced drastic price cuts on electronic, home goods and toys, part of Wal-Mart’s Christmas marketing strategy.
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