A DENT IN WAL MART's

PUBLIC IMAGE – THE PR

STRATEGY
 About Wal-Mart
The history of Wal-Mart can be tracked back to the 1940s.
Sam Walton began his career in retailing at J.C. Penney.
1943 : Walton met the Butler Brothers who owned the retail chain Ben
Franklin Stores.
Ozark Mountain town of 2,900 residents would become the headquarters
for the world's largest retailer.
1962 : Walton invested 95% of the capital to open the first Wal-Mart
store.
 Introduction to the case
2004 : Wal-Mart Stores with sales of $ 256 billion accounted for 2% of
the GDP.
Strategy : Everyday low prices and widespread presence.
Emerged as the largest retail store in the world .
As it grew in size, it began to draw the attention of the media and the
labor unions.
It's non-unionised labor and anticompetitive practices faced resistance.
 Contd…
Wal-Mart had been avoiding interaction with the media and was labeled
media-shy.
Led to more criticisms against its public relations policies.
Labor lawsuits that alleged low wages, gender discrimination and illegal
immigration labor further damaged the company's image.
Consumer advocates publicly claimed that Wal-Mart was bad and cancer
on the economy .
 Contd…
Anti globalisation activists blamed the company for having exploited
labor.
In sweatshops in Bangladesh , China and other Asian countries to offer
low prices to the customers.
Campaign launched
2005 : Launched a major public relations campaign in 100 newspapers
like New York Times, USA today and Wall Street journal .
To assure :
1) It was a fair employer
2) It provided most of the health benefits to its employees.
Television advertisements featured Wal-Mart employees especially
the women talking about Wal-Mart as a great working place.
For the first time in 43 years , the company had formally faced media.
Lee Scott , CEO, Wal-Mart inc. signed the print advertisement : "Wal-
Mart is working for everyone "
Analysts felt that such a campaign was insufficient to revamp the image ,
damaged over years.
This reactive public relations and company's defensive stand would
further harm the company by attention .
Other claimed that :
a. By buying media slots in major newspapers, the company was trying to
gain favour from media
b. Also, the company was misleading the public with its false claims
For too long , others have had free rein to say things about our company
that just aren't true . We have decided it's time to draw our own line in the
stand.
- Lee Scott, Chief Executive Officer, Wal-Mart
Inc.

I think they are going to have a tough time suddenly overcoming the
perceptions of some people. It is going to be a tough sell on their part.
- Larry Bevington , Chairman , Save our
Community
Lowest prices for All -Always
World Economics Liberalized, Wal-Mart jumped to outsourcing.
Continuously focused on its philosophy of bringing the lower prices to the
customers.
It put pressures on its suppliers in U.S. And overseas to cut down prices.
Wal-Mart became more powerful in its retail landscape.
Wal-Mart demanded the prices of its products to drop every year which
put pressure on its suppliers.
 Contd….
Merchandise sold in an year was twice more than all it competitors.
Communication strategy revolved around the lower price strategy that the
company believed as it's cornerstone.
"Smiley Yellow Faces" – promoted its superior image as a discount store
that offered quality products at lowest prices.
As Wal-Mart expanded from small towns to large cities, critics questioned
its anticompetitive practices .
 Contd….
Relied more on central circulars and national newspapers over local
newspapers.
In 1994, Fortune magazine named Wal-Mart as "Most Admired "
company in America .
It also faced lawsuits.
Local Media were a big criticism to Wal-Mart's expansion as it feared
increase in failure rate of local stores.
 Steps taken to improve its
image in the society…
To face communication crisis a PR team was put in place.
Under CEO, Lee Scott PR Campaign in over 100 newspapers were
launched
Jay senior VP stated that :-
" Campaign was not response to any recent affairs but was addressed
towards long term solution for the image drained over the years"
The CEO confirmed that the campaign wanted to get rid of the MYTHS
among the customers, union workers and the public about the company.
The CEO also issued an open letter in the ads stating that the company
provides good jobs with excellent advancement opportunities.
PR team was sent to major metro areas to attend media calls.
Employees themselves took initiative to send mails to editors refuting the
criticisms.
In the Print Advertisements the company held some special interest
groups and critics responsible for spreading misinformation.
Wal-Mart's benefits manager sent a letter to New York Times stating that
the company provides health benefits to their employees.
The district manager wrote a similar letter to The Salt Lake Tribune.
The CEO became the 1st person to address the National Retailer
Federation Trade Group.
In which he openly condemned the medians wide coverage on its imports
from China and employees labor policies.
The executives declared that IF the policies would have been so bad then
the chain would not have grown to the size it did.
It changed its low prices proposition which had been guiding its
advertising strategy .
The commercials the released were not meant to sell any product but
focused on creating overall goodwill about the company .
"Meanwhile , as the company was working towards restoring good
employers image , Federal raids in the store in the country bought to light
200 workers with illegal immigration licenses "
However it reported that the Federal Government had betrayed them as it
stated that " it had already agreed with Federal Government to corporate
the immigration officers in exchange of which it was to be left untouched
"
An internal lawyer was appointed to regularly investigate the hiring
practices of the company.
The company also began to actively corporate to smoothen the
investigation process.
A professor specialising in Labor Issues stated that " I think we have
reached a critical mass of bad publicity for Wal-Mart . Settlement , as
expensive as they are, stop the bleeding ."
The company accelerated its image makeover efforts by :-
 Launching testimonial advertisements
 1st time increasing its political donations to $1 million
 Other advertisements showed how Wal-Mart contributed to other local
communities
 In an alliance with NPR (National Public Radio) , Wal-Mart announced in
radio about it being a good employer
 It further began to offer scholarship for journalist studies in about 10
universities nationwide.
Some observers claimed that the company was seeing corporate benefits.
 A Behemoth called Wal-Mart…
Revenue- US $ 421.849 billion.
Nearly 2% contribution to the GDP.
Wal-Mart employs 2.1 million associates worldwide in more than 6,700
stores in the U.S. and more than 1,500 throughout the rest of the world.
Serves more than 138 million customers per week.
Wal-Mart – Accused of doing PR the wrong way .
What went wrong?
Media stone walling.
Company's hesitant attitude.
' No Comment' strategy .
 Remedial Measures undertaken:
Paid search ads from yahoo and others.
Launched walmartfacts.com
Press releases.
Community Fact Sheet.
Corporate and Financial Fact Sheet.
Health and Wellness Fact Sheet.
Opportunity Fact Sheet.
Sustainability Fact Sheet.
How many jobs we provide
Average wages.
Suppliers jobs we support.
How we give back in your community.
WAL-MART'S FINANCIAL
RESULT
STOCK VALUE
 Conclusion
Wal-Mart has been growing at an impressive rate.
But, there is no smoke without fire.
Present hard facts and figures to the media.
Adopt media friendly strategy with backup.
Solve problems from within.
Thank you