Walmart’s Marketing Mix

Walmart’s Marketing Mix

1. a) Briefly describe the service/s or product/s offered by the company, and give a clear explanation of their Unique Selling Point

Wal-Mart is one of the significant retail companies in the United States. It is arguably the largest in the world, with more than 11000 stores in various parts of the world (Ellickson, 2016, p. 3). However, the company has slowly been losing its market share over the past few decades, a factor that calls for the managers to make some positive changes in its marketing mix. Walmart offers many products with retail products as the most significant. It also provides pharmaceutical products and services such as wireless services and photo lab. Retail products include electronics such as computers, digital cameras, laptops, MP3 players, and printers (Ellickson, 2016, p. 5). Other products include jewellery, movies, music downloads, and books. Walmart also offers some of the relatively simple products such as grocery items, baby products, and sporting equipment and attire.

Walmart has, for a significantly long time, offered photo lab services both online and in the physical stores. One can access the services by dropping their photos at Walmart store kiosks (United States Securities and Exchange Commission, 2018, p. 9). The online services require customers to upload their pictures to the company’s website for editing. The clients can then collect their processed photos at the stores or download them from the company’s website.

Walmart has been known for offering pharmaceutical services for more than a decade. One factor that makes the company the preferred place for seeking medical assistance is its significantly low cost that falls to as low as $4 per prescription (United States Securities and Exchange Commission, 2018, p. 9). The idea of offering pharmaceutical products had a significant impact on Walmart’s performance in the market, a factor that encouraged similar organizations to provide the same products and services. The positive change in the number of sales and profits was because one could save significant amounts of money when they buy drugs at Walmart compared to the pharmaceutical shops and health organizations (United States Securities and Exchange Commission, 2018, p. 10). The management reported that its customers saved about $3 billion since 2006 by buying various drugs at Walmart. The company also makes some special considerations to patients with long-term health problems by offering monthly prescriptions for mail services or pick-up in-store services.

Walmart has established a significant reputation all over the United States and the world in offering financial services. Some of the services provided include check printing, money transfers, debit cards, bill payment, check cashing, and credit cards (United States Securities and Exchange Commission, 2018, p. 5). Walmart’sfinancial services are relatively unique from those of other organizations in the market. Some of the factors that make them different include its store credit card that does not charge an annual fee. One can also get a debit card online or through the physical stores (United States Securities and Exchange Commission, 2018, p. 5). At Walmart, one can send as little as $4.75 through Moneygram. The organization also allows customers to send bill payments, purchase gift cards and money orders, and order printed check at a significantly low cost that goes for as little as $3.

Walmart works with several wireless providers in the United States and other parts of the world to ensure the services reach as many clients as possible. T-mobile company is one of Walmart’s significant partners in the provision of wireless phone services (United States Securities and Exchange Commission, 2018, p. 11). Walmart’s involvement in the telecommunication industry has given clients significant opportunities to enjoy offers, such as unlimited voice calls and text services at significantly low prices.

Unique Selling Point

Walmart Unique Selling Point is described differently from those of producer companies. That is based on the fact that the organization does not produce its products but relies on its suppliers to design products in ways that will attract as many customers as possible. For that reason, Walmart focuses most of its innovation in the delivery of services and products to its consumers (United States Securities and Exchange Commission, 2018, p. 16). The organization has achieved significant uniqueness in the market through its segmentation strategy marketing its products and services. The method involves the analysis of different segments of the customers and their dynamic needs. Segmentation can be achieved through various means, including demographic and psychographic approaches. Walmart uses both ideas to know the preferences of its customers (United States Securities and Exchange Commission, 2018, p. 17). Through segmentation, the organization was able to know that their clients always long for a time in which retailer companies will start offering everyday products and services at the lowest price, possible. That finding influenced the management of Walmart to introduce a philosophy that would encourage customers to buy more every day. They created the strategy of EDLP, which stands for Every Day Low Price.

1. b) Thinking about marketing mix decisions, what “lessons” or marketing tactics do you think can be borrowed from other products on the market that can make their product stand out. EXPLAIN how these would work for the organization

Walmart’s market mix significantly promotes its competitive advantage over most of its significant competitors in the retail industry, such as Amazon. This paper describes the company’s mix by focusing on four essential elements which include promotion, price, product, and place. Walmart’s marketing mix also revolves around the situation of the retail industry and the organization’s strategic goals.

The stated elements which are also referred to as the 4Ps are also significantly connected to the organization’s strategic choices as a significant retail company in the United States and the world. The four elements also describe Walmart’s strategic plans to achieve global success. The company’s strategic mix can also be used to explain the progress it has made over the past few decades despite the significantly stiff competition from significant global organizations such as Costco Wholesale, Home Depot, Whole Foods, and Amazon (Ellickson, 2016, p. 15). An analysis of Walmart’s situation using Porter’s Five Forces analysis shows that the organization’s competitors have the potential of defeating Walmart in at least some of its strong points. For that reason, Walmart is forced to create a marketing mix that is effective enough to overcome the competition (Ellickson, 2016, p. 15). Walmart has achieved significant success in that area through its coordinated strategic effort on matters price, place, product, and promotion.

Walmart employs many strategies to maintain its marketing mix. One of the significant ways to do so is the promotion of its operational efficiency and streamlining of its processes. Doing so enables the organization to achieve a significantly high level of efficiency, something that minimizes the company’s cost of production (United States Securities and Exchange Commission, 2018, p. 19). The low cost of operation then enables Unilever to offer its goods and services at significantly low prices compared to its competitors. Providing goods and services at low prices compared to competitors who offer the same products or services gives an organization a competitive advantage to cost-sensitive customers.

Product is the first element of Walmart’s marketing mix. The organization focuses mainly on the sale of retail products and digital services. Walmart has achieved significant success in offering retail services. For that reason, the product element contributes significantly toward the customer’s substantial interest in Unilever. The mix promotes efficient, effective, and convenient services at the organization (United States Securities and Exchange Commission, 2018, p. 23). The mix requires the salespersons to play other roles, such as assisting clients in locating the position of various goods or services in the stores. Creating a marketing system that enables customers to get the different products and services they want within the shortest time possible is one of the factors that promote customer satisfaction and loyalty.

Prices and Pricing Strategies is another significant element of the 4Ps. Walmart employs many strategies to improve its performance in the retail industry. The Everyday Low Price model is among the significant approaches (United States Securities and Exchange Commission, 2018, p. 18). The creation of the strategy was based on the fact that almost all customers would like to be buying the products and services that they use more frequently at the lowest price possible. For that reason, the idea attracts significantly large numbers of customers, a factor that increases the number of sales. The volume of sales is directly proportionate to the amount of profits accruing from Unilever’s business activities.

Walmart and many other retail companies are well-recognized for offering goods and services and significantly low prices and thin profit margins. For that reason, such organizations rely more on the number of sales to increase net profits. Walmart aims mainly on increasing the number of buyers in a bid to achieve high profits (Ellickson, 2016, p. 37). That is the reason why the element of pricing is perceived as a contributor to Walmart’s competitive advantage. Another factor that makes Walmart’s pricing a significant contributor to the company’s competitive advantage is the fact that it uses prices that are oriented to the market for most of its products and services (United States Securities and Exchange Commission, 2018, p. 31). The company also uses the strategy of flat-rate subscription strategy in its market mix. The idea is applicable mainly on the goods and services offered through online websites.

On the element of place, Walmart’s marketing mix includes the strategy of intensive distribution channel design. In that matter, Walmart offers the same goods and services through its e-commerce websites and stores (Chatterjee, 2017, p. 9). The high accessibility of products and services at Walmart’s stores and e-commerce websites attracts significant numbers of customers who like convenience during shopping (Heller, 2017, p. 7). Walmart’s decision to introduce e-commerce was in response to the significant difficulty associated with the creation of physical stores in various parts of the world. The distribution of goods from the producers to the store is also challenging. However, e-commerce offers a lasting solution because people from almost all parts of the world can access the company’s website and view the various goods and services offered and their corresponding prices (United States Securities and Exchange Commission, 2018, p. 6). They can then make orders and receive products or services through various methods.

On the element of promotion, Walmart’s marketing mix includes many approaches for promoting public recognition of their operations. They conduct advertisements through the forms of media such as newspapers, websites, televisions, and other methods of attracting public attention (Sims, 2018, p. 45). The mix is also composed of promotion activities such as personal selling, sales promotions, and public relations. Walmart is also known for using discounts and special deals to attract more customers. On this type of promotion, the company uses its salesperson in personal selling. On that, the employees are directly involved in the advertisement process by encouraging customers to try new products and services (United States Securities and Exchange Commission, 2018, p. 56). Walmart is also known for using charity programs and press releases to inform investors and clients about strategies, programs, and policies. The approach is meant to attract not only customers but also fulfil part of the company’s corporate social responsibility (United States Securities and Exchange Commission, 2018, p. 56). In general, the element of promotion in Walamat’s marketing mix significantly promotes the organization’s ability to attract customers and improve its reputation as well.

Recommendations

Amazon’s marketing mix portrays many positives, but the company needs to improve in its promotion element. Retail companies such as Amazon are focusing more on achieving global recognition. Walmart has done a lot on the same, but there is still room for improvement. By looking at Walmart’s marketing mix, one can see that the organization is a result of strategic choices that consistently relate to corporate and business-level strategies (LeCavalier, 2016, p. 12). The retail market in the United States and other parts of the world is significantly saturated. Established companies such as Amazon pose stiff competition for scarce resources. Walmart’s significant success over the years shows that its 4Ps have significantly helped the company remain competitive at all times. The element of product in Walmart’s market mix shows that the organization keeps trying to achieve significant growth, mainly through diversification (United States Securities and Exchange Commission, 2018, p. 60). Vudu’s digital content distribution services offered on-demand have helped many retail companies achieve significant growth (United States Securities and Exchange Commission, 2018, p. 61). Walmart is among the companies that have used the idea in their bid to achieve meaningful growth. Walmart’s idea of strengthening its public relations and improving its promotional efforts is a positive step. Such strategies help retail companies to achieve significant success by enhancing their presence in the market (Ellickson, 2016, p. 13). On the element of place, Walmart’s idea of combining the physical stores with e-commerce is a fruitful idea that can help the organization to achieve significant success. In summary, Walmart has an effective 4P. However, the organization should look for ways to improve its presence in the international market. Doing so will enable the company to achieve a global competitive advantage in e-commerce and retail services (Sims, 2018, p. 10). The organization should borrow the idea from other retail companies that have achieved massive success at the international level such as Amazon. The idea could work for Walmart because it also worked for other retail companies.

1. c) Using the perceptual map show where the organization’s products are positioned against the competition. Why do you think they are in this position?

The quality dimension of Walmart’s shows some red alerts that call for the organization to make some improvements in a bid to achieve a more significant market share. According to Wingfield,  Mozur, and Corkery, Walmart’s market share has reduced at least to some extent due to the considerable success achieved by most of its competitors such as Amazon (Wingfield, Mozur, and Corkery, 2018, p. 23). Some clients perceive Walmart’s products as being of low quality. According to Sims, a negative identity can have disastrous effects on a company, regardless of size (Sims, 2018). The negative perception is so significant that some customers would prefer to blindly order products from online companies such as Amazon and leaving Walmart’s products which one can see and touch at the company’s stores (Wingfield, Mozur, and Corkery, 2018). I think Walmart is in this position because of its sting emphasis on the price of commodities and services. High-quality products and services are mostly offered at relatively high prices. However, sometimes an organization that focuses a lot on price as a means to gain competitive advantage will result in providing low-quality products and services in a bid to meet consumer expectations and make some profit at the same time.

References

Chatterjee, S., 2017. Two efficiency-driven networks on a collision course: ALDI’s innovative grocery business model vs Walmart. Strategy & Leadership.

Ellickson, P.B., 2016. The evolution of the supermarket industry: from A & P to Walmart. In Handbook on the Economics of Retailing and Distribution. Edward Elgar Publishing.

Heller, F., 2017. Technological innovation applied to Walmart and Tesco’s supply chain (Doctoral dissertation).

LeCavalier, J., 2016. The rule of logistics: Walmart and the architecture of fulfilment. U of Minnesota Press.

Sims, S., 2018. Acquisitions: Walmart vs Amazon.

The United States Securities and Exchange Commission., 2018. Walmart Inc. United States Securities and Exchange Commission. https://www.sec.gov/Archives/edgar/data/104169/000010416918000028/wmtform10-kx1312018.htm

Wingfield, N.I.C.K., Mozur, P.A.U.L. and Corkery, M.I.C.H.A.E.L., 2018. Retailers Race Against Amazon to Automate Stores. The New York Times.