Brand Autopsy

93 percent of us have had our souls sucked out through our eyeballs. Frightening. I have never been prouder to be in the 7% minority :)

Here's the thing though: Why WOULDN'T we all go to Walmart for lowdown commodity items? Why is it not a good thing that Walmart offers these mundane goods at cheap prices? Do you really want to go to a specialty store for a non-descript wooden spoon or underwear, and pay 3X more? For marketers, what is really the big deal? Do people really care about what brand the $2 wooden spoon is? They don't. The smart marketer can see that the ubiquitous $2 Walmart wooden spoon made in China creates the opportunity for small Cutlery brand YYZ to do fine exotic hardwood spoons made in Maine perhaps, sold at premium price/margin, at finer stores and cutlery retailers. Think about it. THAT's a marketing opportunity.

And really, what is the ill-effect of Walmart on the US ecomomy? There isn't one. The spoon is made in China for .50, the factory sells it for $1 to Walmart, who resells it to US consumer at $2, in much higher volumes than the consumption rate would be on a US union-made spoon of the same design, costing $6 or more. We'd just purchase fewer and fewer spoons, until the union collapsed and we start importing them anyway. Our economy is way ahead with Walmart and others importing cheap commodities. The general stores and mom/pops huts that Walmart kills were in a slow death to begin with. Nothing easy lasts forever. Change happens, but we have to actually LOOK and understand it, and we may actually see some good, economically and otherwise.

I'm definitely one of the 93%
95+% of the stuff I buy there (groceries and auto care)is American made/grown.
The secret is to grocery shop on Tue or Wed after 8pm.
The place is pretty much empty.
Never on the weekend.

The more important question is of those 93%ers, what percentage of their annual consumer spending is spent at Wal-Mart. And, I wonder of the 7%, whether they go to K-mart, Target, or some other discount store to buy the same things as they would at Wal-Mart?

I do the majority of the shopping in my household. I tried Wal-Mart a few times and then switched permanently to Target. My two main viewpoints of Wal-Mart are:

1) All of the stores i've been to look like they've just been ransacked, compared to the relative cleanliness and neatness of Target.
2) Their low price leadership is over-rated; on brand name items, they are just a few pennies cheaper than Target.

I'll spend a few extra bucks at Target and keep my sanity.

Thomas … I agree with your Clayton Christensen-esque thinking on once commoditization occurs, a reciprocal process of de-commoditization also occurs.

So yes … Wal*Mart commoditizing everyday shopping creates opportunities for other retailers to make everyday shopping more special and something they will pay extra for. Whole Foods Markets is de-commoditizing grocery shopping. Williams-Sonoma is de-commoditizing shopping for kitchen stuff. Restoration Hardware is de-commoditizing shopping for house stuff. This is a good thing for marketers!

I’m part of the 93% and I’ve shopped and purchased a few items at Wal*Mart in the last 12 months. I bought a wide-screen DVD set of Star Wars movies at Wal*Mart after not being able to find the wide-screen edition at three other retailers.

I felt dirty buying the DVDs at Wal*Mart because I know the company goes to extreme lengths to bring lower prices to market. Extreme lengths which includes under-paying store employees, offering employees less than generous benefits, and muscling vendors to squeeze margins. All off these extreme lengths come at a cost. A cost I think is too high to pay.

Just yesterday I needed to stock up on some staples (paper towels, toothpaste, hand soap, etc) and I chose to shop at Target. I saved some money but I also saved myself from feeling dirty. Dig?

John, I dig, especially if it makes you feel better, and more cleanly!

For me, little difference in the overall concept, model, method and effect between Target and WalMart, although they are for sure positioned differently than they actually are. If Target were as successful as WalMart, it'd be them you'd hear all the dastardly news about, instead of WalMart. Target's buyers and HR peeps use the exact same methods as WalMart...they ALL do, but Walmart is big, they get the AFP/Reuters/ACLU headlines. But hey, I get it. People need to feel good about where they spend money. And choice is good.

I reckon it is all in how one defines success. As a marketer, I prefer to define success more by year-over-year same-store sales than by market share. And by the measurement of year-over-year same-store sales, Target is beating Wal*Mart. Target's August same-store sales are reported to be twice that of Wal*Mart's.

Ya know ... I don't think Target wants the same success achieved by Wal*Mart. The cost is too high. Besides, Target can make a very good living being a JumboShrimp to Wal*Mart's whale.

I should have said "if Target were as big", rather than "as successful". I agree, Target's performance is not too shabby, to say the least. On the other hand, when you are as locally-penetrated as WM, your comp sales are not going to grow as a %...you are already there, and it'd be a mistake to think they would. (Their growth will largely come internationally from here on out, and at a lesser rate.) Target's comps can, and will grow, agreed. Hard not to define WM as wildly, ridiculously successful by any measure or definition though. The idea that the cost of their success is too high, may be a better socio-political argument rather than an economic one. Personally, I'm not anxious to work at either place, but knowing folks that do/have, I'd say same difference, and both are darn good comparatively.