Wal-mart is reviewing their advertising agencies for the first time in 30 years. According to an article in the New York Times (“Wal-mart on the Hunt for an Extreme Makeover“) and an article in Advertising Age (“Wal-Mart Puts $578 Million Account into Review“), Wal-mart has notified their current advertising agencies that they are reviewing the accounts and will be soliciting new agencies to work with.
This is a huge account for an agency to grab, and I will be interested to see how many are going to be clawing to get it. As the New York Times points out, most agencies with retail background probably already work for their competitors. Beyond that, it’s difficult for an agency to effectively communicate the Wal-mart message when Bentonville wants the best of every world. There is still the gray area that they hope to dance in to attrack the upscale demos without alienating their foundation. At some point they are going to have to decide what is more important. You can throw many balls up into the air at the same time, but at some point you have to catch them. I think in the near future, Bentonville is going to drop a few.
A chief criticism of Wal-mart has always been the shopping experience. As Charles Fishman points out in his book, “The Wal-Mart Effect” (see my review here), Wal-mart can make great strides in merchandise, advertising, and with what customers they are targeting, but at the end of the day they are still going into the same stores with the same poor shopping experience – uninviting stores with crowded racks and poor customer service.
As they point out over at the Retail Design Diva, maybe Wal-mart is starting to have some success with their initial rebranding efforts. For Wal-mart and their new (or present) advertising partners to effectively broadcast a new message and attrack more upscale consumers, they have to aggressively attack the advertising, the merchandising, and the overall customer experience. To rethink each one of these areas on the scale that Wal-mart exists on is enourmous. The kind of change that Wal-mart needs to move ahead needs to be seen in every corner of the country. If they are going to do it, they need to do it big – because that’s how they’ve always done it.
I will be watching Wal-mart to see how they are able to transition themselves, but this story has just begun.