Walmart, the largest retail company, was founded by Moore Walton and James Lawrence. It is the largest company in terms of revenue and size of workforce. In the fiscal year of 2016, the revenue generated by the company amounted to 482 billion Dollars. Walmart has about 110000 stores in 28 nations and a weekly global customer base of more than 26 billion. The company has found this large-scale success due to the successful implementation of the following marketing strategies:
1. Segmentation, targeting and positioning in Walmart’s marketing strategy:
- The segmentation strategy is used to understand different sub-sections of customers and their constantly evolving needs, preferences and purchase trends. Walmart deploys demographic and psychographic segmentation strategies. Using this strategy, the marketing experts decipher the psyche of the consumer who wish to purchase the retail company’s regular goods at the minimum price ranges.to enable this, Walmart incorporated the strategy of EDLP-‘Every Day Low Prices’, as a part of its marketing scheme.
- The retail giant implements a homogenous targeting strategy to capture a global customer-base. Since every individual is a potential customer, the strategy of differentiation is not used by Walmart to a crucial advantage. The price of products acts as the major differentiating factor for Walmart. Hence the strategy of low, affordable is used by the Walmart to target the largest mass of consumers.
- The company’s marketing success has been attributed to the positioning strategy as well. The positioning stance taken by the company is that of a company offering everyday products at a mass scale at affordable prices. This pricing advantage has helped the retail giant maintain its sustainable business model. The positioning of this low pricing strategy has helped Walmart dominate over small retail companies for several decades of its operations.
2. Competitive advantage in Walmart’s marketing strategy :
- USP of lowest price: The EDLP strategy has turned out to be one of the most unique selling strategies of Walmart. For example, the Black Friday is a famous event when Walmart offers their products at highly discounted prices. This strategic pricing move has provided the company with great competitive edge over its rivals.
- Broad products assortments: Walmart specializes in dealing with large collections of goods and broad stock keeping units (SKU).These not only ensures that the company retains its customer-base but also helps it to earn a significant profit margin.
- Operations: The success of a retail chain as huge as Walmart is largely attributed to its operational management. This implies that that the company puts great emphasis on its operational and supply chain strategies to ensure that each of its large numbers of customers get fast access to whatever product they desire.
3. BCG matrix in Walmart’s marketing strategy:
The Company primarily operates through the wholesale and retail channels of its business. However, the business is conducted through three distinct segments namely Walmart US, Walmart International and Sam’s Club. In 2016, 62% percent of net sales revenue earned by Walmart was generated from the Walmart US, whereas 26 percent of the net sales earned by Walmart were generated from Walmart International.12 percent of the net sales revenue earned by Walmart came from Sam’s Club.
Whatever the business segment that the retail giant operates in, Walmart has proved to be a STAR in the BCG matrix. The company has several rivals in the global retail market, but Walmart has earned one of the largest shares in the market. However, the growth rate of market is so strong, that the share of each of Walmart’s rivals also keeps on enlarging. On the basis of these two factors take together, Walmart can be projected as a STAR on the BCG matrix. The retail giant dominates in a high-growth, competitive market.
4. Distribution strategy in Walmart’s marketing strategy:
Walmart has retail outlets in 27 nations, other than United States of America in retail, wholesale and other categories. All these categories have operational formats of warehouse clubs, supermarkets, hypermarket cash and carry formats, convenience stores, specialty stores, super centers etc.
The retail outlets of Walmart are physical entities of sizes varying from 4000-180000 square feet. Similarly the wholesale outlets are also physical entities of sizes ranging from 35,000-70,000 square feet. Walmart US has about 139 distribution outlets, through which about 79 percent of its products and merchandise are shipped. It ranks sixth in terms of retail sector supply chain distribution, whereas it ranks 16th in global supply chain distribution.
This widespread distribution strategy also proves that Walmart is the biggest retail company in America and one of the premier ones in the world.
The successful implementation of all these aforementioned marketing strategies has contributed to the enormous success of Walmart and turned it into a global retail giant. The company has been ranked in the 22nd position in Forbes’ list of most highly-valuation brands.