Walmart is a multinational retail corporation that operates retail stores in the form of hypermarkets. It was founded in 1962 by Sam Walton. Today, the company has more than 10,000 stores and clubs in 24 countries. The Walton family controls the company, including billionaires such as Jim Walton, Alice Walton, S. Robson Walton, Lukas Walton, Ann Walton Kroenke, Nancy Walton Laurie, and Christy Walton.
Walmart’s marketing strategy plays a significant role in its success in the competitive retail business. The retail industry faces immense competition, and many companies have failed to survive. Walmart’s marketing strategy has also helped it withstand the competition from e-commerce giant Amazon. The company’s stable management procedures contribute to its stable operations. The Walmart Marketing Mix is a key factor in the company’s ongoing success.
This article delves into Walmart’s marketing mix, examining the 7Ps: Product, Price, Place, Promotion, People, Physical Evidence, and Process. Walmart Inc., an American multinational retail giant, operates hypermarkets, discount stores, department stores, and grocery outlets with an extensive supply chain across the United States.
Based in Bentonville, Arkansas, Walmart was founded in 1962 by Sam and James “Bud” Walton. With a staggering revenue of $611.3 billion, Walmart ranks among the world’s largest companies. It faces competition from rivals like Amazon, Target, Home Depot, and Kroger.
Walmart’s retail strategy revolves around offering competitive prices, achieved through economies of scale and large-scale operations. This strategic approach enables Walmart to negotiate favorable terms with suppliers, ultimately translating into cost savings for customers. The analysis in this article provides a comprehensive examination of Walmart’s Marketing Mix.
History of Walmart
Walmart is a retail corporation operating globally, founded on July 2, 1962, by Sam Walton and James “Bud” Walton.
Its headquarters are located in Bentonville, Arkansas, United States. As one of the world’s largest retailers, Walmart serves customers worldwide and employs approximately 2.2 million people.
The company’s key leadership includes Greg Penner as Chairman and Doug McMillon as CEO.
Target Market for Walmart
The target audience of Walmart is low to middle-class rural families. These people want to shop conveniently in a single location.
The price and discounts are something they look for while shopping. Walmart has been able to understand the target audience and created its stores as per the demand trends.
Walmart’s 7Ps marketing mix
We’ll look at Walmart’s 7Ps marketing mix to discover its unique and interesting ways to market its business in this time of stiff competition.
Product
Walmart offers a diverse range of products to its customers, available through its numerous physical locations and online stores.
As of 2024, Walmart’s product mix includes:
- Home Essentials: Catering to home needs with furniture for all areas, bedding, home décor, kitchenware, and garden supplies.
- Fresh Groceries: Offering a wide array of fresh produce, meat, dairy products, baked goods, canned foods, organic options, and deli/bakery items in Walmart Supercenters.
- Electronics and Appliances: Providing a selection of electronic devices such as TVs, laptops, cell phones, cameras, and a variety of home appliances.
- Health and Beauty Essentials: Offering pharmacy services, over-the-counter medications, personal care items, beauty products, and wellness supplements.
- Sports and Outdoor Gear: Providing sporting goods, fitness equipment, outdoor gear, bicycles, and related accessories.
- Toys and Gaming: Offering a diverse range of toys for various age groups, video games, and gaming consoles.
- Pet Care: Providing food, toys, grooming products, and other essentials for pets of different kinds.
- Fashion and Footwear: Featuring clothing and accessories for men, women, and children, including basics, fashion apparel, shoes, and accessories.
- Automotive Products: Including car parts, tools, accessories, and automotive services available in select locations.
- Entertainment: Offering a selection of books, DVDs, and music CDs for entertainment and education.
- Arts, Crafts, and Party Supplies: Offering art and craft materials, party decorations, and sewing supplies.
- Baby Essentials: Featuring baby gear, clothing, diapers, food, and other necessities for infants and toddlers.
This diverse product mix reflects Walmart’s strategy to be a one-stop shop for a wide range of consumer needs, both in-store and online.
Pricing
Price plays a crucial role in determining the success and longevity of a product in the market. It directly influences the revenue generated from sales and the product’s competitiveness. Finding the right balance between price and volume is essential for businesses to thrive.
Walmart’s pricing strategy is comprehensive and aimed at attracting customers while reinforcing its brand as a leader in offering value within the retail sector.
Here’s a breakdown of their pricing strategy:
- Everyday Low Prices (EDLP): Walmart’s core strategy revolves around offering consistently low prices rather than relying heavily on promotions or sales. This approach simplifies choices for budget-conscious customers and fosters long-term loyalty.
- Customer-Friendly Pricing: Rather than overcharging, Walmart focuses on making prices accessible to customers, which in turn drives bulk sales and revenue.
- Cost Leadership: Walmart achieves its low pricing through efficient supply chain management, bulk purchasing, and negotiating with suppliers to reduce costs. These savings are passed on to customers, giving Walmart a competitive advantage and setting industry price standards.
- Superior Procurement: Walmart’s adept negotiation skills in procurement help keep costs low, allowing for competitive pricing while maintaining profitability.
- Financing Options: Walmart offers financing for large-ticket items like appliances and furniture, reducing the initial financial burden on consumers and encouraging purchases.
- Price Matching Policy: In a competitive market, Walmart offers a price-matching policy, assuring customers of the best available price by matching lower prices from competitors. This reinforces Walmart’s affordability commitment and encourages customer retention.
- Dynamic Pricing Strategy: Leveraging technology and data analytics, Walmart employs dynamic pricing in its online platform. Prices may adjust based on demand, competition, inventory levels, and market trends, allowing Walmart to remain competitive in e-commerce.
- Diversification: By offering a diverse range of products, Walmart ensures that if one product doesn’t perform well, complementary products can boost overall sales.
- Psychological Pricing: Walmart uses psychological pricing tactics, such as pricing items at $9.99 instead of $10, to create the perception of lower prices. This strategy subtly influences consumer behavior and enhances the perceived value of Walmart’s offerings.
- Efficient Supply Chain: Utilizing universal barcoding and SKU systems streamlines the supply chain, leading to cost efficiencies that can be passed on to customers through lower prices.
These strategies collectively contribute to Walmart’s ability to offer competitive prices, drive sales volume, and maintain a strong market position.
Place
Walmart’s extensive distribution network comprises 4,700 stores and 210 distribution centers, ensuring that a Walmart store is within a 10-mile radius of 90% of the US population.
This widespread presence highlights the significance of studying Walmart’s distribution strategy and supply chain, which have contributed significantly to its success.
Place plays a vital role in any business as customers value accessibility and convenience. Walmart employs various strategies to ensure that the location aspect, a crucial part of the marketing mix, is both effective and efficient.
- Strategic Store Placement: Walmart strategically places its stores, particularly in the U.S., in locations that are conducive to business success, optimizing foot traffic and customer accessibility.
- Extensive Geographic Reach Walmart strategically places its stores across urban, suburban, and rural areas to ensure accessibility for a diverse customer base, with 90% of the US population living within 10 miles of a Walmart store.
- Robust eCommerce Platform: Walmart’s powerful online platform enables customers to make purchases without visiting physical stores, enhancing convenience and accessibility.
- Efficient Delivery Logistics: Leveraging a fleet of delivery trucks, Walmart ensures swift and reliable delivery of products from door to door, enhancing customer satisfaction.
- Store Diversity: Walmart operates various formats including Supercenters offering a wide range of products, Neighborhood Markets catering to local needs, and Walmart Express for quick shopping in urban areas, providing options for different customer preferences.
- Organized Distribution Network: A well-organized network of distribution centers facilitates seamless order fulfillment, allowing businesses to efficiently pick up orders and deliver products directly to customers.
- Online and Seamless Integration: Walmart has a robust digital platform and mobile app, enabling online shopping with diverse delivery options like in-store pickup and home delivery, seamlessly integrating physical and digital shopping experiences.
- Inventory Tracking: Walmart employs advanced inventory tracking systems to monitor stock levels, ensuring products are readily available and reducing instances of stockouts.
- Global Expansion and Localization: Internationally, Walmart adapts its stores and products to local preferences and cultures, ensuring relevance and acceptance in diverse markets while maintaining a consistent brand identity.
- Efficient Supply Chain: Walmart’s distribution centers and logistics technology ensure efficient supply chain management, facilitating quick restocking and reducing lead times, which enhances customer satisfaction by ensuring product availability.
- Brand Differentiation: Walmart differentiates its various store types to create high brand recall, catering to diverse customer needs and preferences effectively.
This comprehensive approach to place strategy aligns with Walmart’s goal of providing convenient and accessible shopping experiences while optimizing operational efficiency and adapting to local market dynamics.
Promotion
Walmart employs an active promotion strategy aimed at retaining existing customers and attracting new ones through both in-store promotions and online marketing initiatives.
This strategy is integral to Walmart’s marketing mix and contributes significantly to its overall success.
Key promotional strategies currently utilized by Walmart in 2023 include:
- Walmart+: Similar to Amazon Prime, Walmart+ offers premium benefits to subscribers, including free shipping, discounts, and other exclusive perks.
- Seasonal Sales: Walmart conducts sales events with discounts during different times of the year to attract customers and boost sales. Walmart provides discounts of up to 50% on selected product lines, ranging from electronics to apparel and household goods, as well as school supplies.
- Coupon Campaigns: Walmart employs a variety of coupons accessible through its online platforms, such as the Walmart App and website, as well as through print media. These coupons, combined with discount offers, effectively incentivize customers to make purchases at Walmart and contribute to customer retention efforts.
- Slogans and Messaging: Walmart uses catchy phrases like “Save money, live better,” “lowest price store,” “worry-free fresh,” and “everyday low pricing” to create excitement and highlight its value proposition to consumers.
- Multichannel Advertising: Walmart employs diverse advertising channels such as television commercials, billboards, social media platforms, and eCommerce websites to reach a broad audience and promote its offerings effectively.
- Safe Shipping Options: For online customers, Walmart provides secure and reliable shipping options that prioritize the delivery of products with high-quality service standards.
- Free Shipping: Walmart offers free shipping for orders exceeding $75 to members of the Walmart+ program, enhancing customer value and loyalty.
- Warranties and Replacement Policies: Walmart backs most of its products with dependable warranties and replacement policies, offering customers peace of mind and enhancing their confidence in the brand’s products and services.
Traditional Promotion Strategies for Promotion Used by WalMart
Walmart utilizes a range of traditional promotional strategies to engage customers and drive sales:
- Digital Marketing: Walmart has a strong presence on social media platforms like Facebook and Twitter, leveraging these channels to reach millions of followers and promote its brand and offerings.
- Pricing Communication: Walmart ensures that its Everyday Low Prices (EDLP) are effectively communicated to customers through various channels.
- TV Commercials and Print Media: Walmart regularly uses TV commercials, print media (newspapers, magazines), and other marketing tools to promote its latest offers and products.
- Sales Promotions: Walmart runs sales promotions during key periods such as Black Friday and back-to-school days, enticing customers with special discounts and deals.
- In-Store Promotions: Point-of-purchase displays, in-store events, and product demonstrations are used within Walmart stores to attract and engage customers.
These traditional promotional strategies, combined with Walmart’s focus on low prices and value, contribute to its success in attracting and retaining customers across various demographics.
People
When it comes to Walmart’s retail service, the “People” aspect of the 7Ps Marketing Mix encompasses both the employees who work at Walmart and the customers who shop there.
For Customers:
- Community Engagement: Engages with communities through charitable contributions, sponsorships, and addressing local needs to build customer loyalty and a positive image.
- Customer Loyalty Programs: Offers savings and benefits through programs like Walmart+ to enhance customer loyalty.
- Customer Diversity: Walmart caters to a wide range of customers, focusing on inclusivity and accessibility.
- Customer Service: Prioritizing excellent customer service through well-trained staff and efficient checkout processes.
- Feedback Mechanisms: Actively seeks and utilizes customer feedback to improve services continuously.
For Employees:
- Employee Engagement: Feedback mechanisms, recognition programs, and a culture of inclusivity are fostered to engage employees effectively.
- Diverse Workforce: Walmart prioritizes diversity in its workforce, reflecting the diverse customer base it serves.
- Training and Development: Employees receive training to enhance their customer service skills and overall performance.
- Career Opportunities: Walmart offers various career paths, encouraging internal promotions and growth.
- Employee Benefits: Competitive wages, health benefits, retirement plans, and discounts are provided to ensure employee well-being.
This comprehensive approach to people strategy aligns with Walmart’s commitment to creating a positive experience for both employees and customers, contributing to its success in the retail industry.
Process
The “Process” element of the 7Ps Marketing Mix emphasizes the procedures, mechanisms, and flow of activities through which services are delivered and consumed. For Walmart, this includes a variety of operational and customer service processes aimed at improving efficiency and enhancing customer satisfaction.
Enhanced Shopping Efficiency
Walmart enhances the shopping experience with streamlined processes. Self-checkout stations are available to expedite the payment process, reducing customer wait times.
Additionally, the Walmart mobile app supports a seamless shopping journey, allowing for online purchases, in-store product location, and mobile payment options.
Efficient Inventory Management
To ensure products are consistently available, Walmart employs advanced inventory management systems. Automated replenishment systems efficiently restock products, minimizing out-of-stock situations.
Vendor Managed Inventory (VMI) programs also help maintain optimal inventory levels by collaborating closely with suppliers.
Optimized Supply Chain
Walmart’s supply chain efficiency is achieved through several key strategies. Cross-docking minimizes storage costs and shortens delivery times by moving products directly from suppliers to stores.
A sophisticated logistics network, with strategically located distribution centers, reduces transportation costs and delivery times.
Comprehensive Customer Service
Walmart prioritizes customer satisfaction through robust service processes. The return policy is straightforward and customer-friendly, allowing for both in-store and online returns for most items.
Multiple channels for customer feedback, including surveys and social media, are implemented to gather insights and improve service quality.
Integrated Online and Omnichannel Services
Walmart’s extensive e-commerce platform allows customers to purchase a wide range of products online.
The company also offers various pickup and delivery services, including same-day delivery options, to enhance convenience for customers.
Health and Safety Initiatives
In response to the COVID-19 pandemic, Walmart introduced several health and safety measures, such as sanitization procedures, contactless payment options, and social distancing guidelines.
The company also maintains emergency preparedness processes to quickly adapt store operations to various situations, ensuring the safety of employees and customers.
Dedicated Employee Training
Walmart invests in comprehensive employee training and development programs. Customer service training enhances interactions, problem-solving, and service delivery.
Additionally, technology and operations training ensure employees are proficient in the latest retail technologies and operational processes, improving overall efficiency and service quality.
These processes are designed to enhance operational efficiency, improve customer satisfaction, and ensure seamless supply chain operations, contributing to Walmart’s success in the retail industry.
Physical Evidence
The “Physical Evidence” component of the 7Ps Marketing Mix pertains to the environment where the service is provided and any tangible items that support the service or promotional strategies used to communicate it.
For Walmart, this involves the physical elements of both its retail and online presence that enhance the customer experience.
Store Layout and Design
Walmart ensures a clean and organized store layout, making it easy for customers to navigate and enhancing their overall shopping experience. Clear signage and aisle markers are strategically placed to help customers quickly locate products, thereby improving shopping efficiency and satisfaction.
Consistent Branding
The consistent use of Walmart’s blue and yellow logo and color scheme across stores, packaging, and marketing materials strengthens brand recognition. Employee uniforms featuring the Walmart logo reinforce the brand identity and make staff easily identifiable to customers.
User-Friendly Digital Platforms
Walmart’s website and mobile app are designed with user-friendly interfaces, facilitating easy navigation, product searches, and online transactions. Digital receipts, order confirmations, and shipping notifications provide tangible proof of transactions, enhancing customer trust and convenience.
Efficient Checkout Process
Modern Point of Sale (POS) systems at Walmart ensure an efficient checkout experience, including options for electronic payments, contactless payments, and self-checkout. Branded packaging for products and delivery parcels serves as physical evidence of Walmart’s service and reinforces brand recognition.
Effective Marketing Materials
Attractive in-store displays, promotional materials, and digital marketing campaigns highlight special offers, new products, and featured brands. Informational signage about services, policies, and community engagement initiatives reflects Walmart’s values and commitment to customer service.
Cleanliness and System Reliability
Regular cleaning and maintenance of stores, restrooms, and common areas contribute to a positive shopping environment. The reliability and high uptime of Walmart’s online shopping platform demonstrate the company’s dedication to quality and service availability.
Comprehensive Safety Measures
Visible health and safety measures, such as hand sanitizing stations and plexiglass barriers at checkouts, show Walmart’s commitment to the well-being of customers and employees. These measures are particularly important in maintaining trust and safety during health crises.
Active Community Engagement
Walmart’s involvement in local communities through store-hosted events, sponsorships, and charitable activities enhances its corporate image and fosters customer loyalty. These initiatives demonstrate Walmart’s commitment to supporting and engaging with the communities it serves.