- CNN reports that Wal-Mart “executives boldly declared to analysts Tuesday that the world's largest retailer was on the cusp of launching its earliest and ‘most aggressive’ advertising and merchandise strategy for the 2005 holiday shopping season.” The move comes a year after what generally perceived as a disappointing lead-up to the holiday season last year, during which Wal-Mart had to use an uncharacteristically promotion-oriented ad campaign to bolster sales.
The campaign is slated to kick in on November 1.
- Good column by Harold Meyerson in the Washington Post evaluating how Wal-Mart and its CEO, Lee Scott, have been trying to “polish the company's increasingly tarnished image.” He notes that Scott has lately been public about supporting a national increase in the minimum wage, improved environmental policies, and a changed approach to health care benefits within the company. (Though he did not address the story broken yesterday by the New York Times saying that the company was looking for ways to hold down health care costs without hurting its reputation – and that one of those ways was to hire only young and healthy employees and shed, where possible, older, less healthy people with seniority.)
Meyerson argues that Scott has to do something to get the company moving in the right direction because its “fortunes these days are anything but bright. The coming crunch in heating oil prices, the decimation of American manufacturing, the steady decline of median family incomes over the past several years, the failure to raise the federal minimum wage since 1997 and the fact that Wal-Mart is setting the pay standards for millions of American workers -- all these are combining to limit the ability of Wal-Mart shoppers to buy as much as they used to. While sales at the Neiman Marcus end of retailing have been doing just fine, the working-class money crunch is taking a real toll in Wal-Mart-land.”
- KC's View:
The more people we talk with, the more we keep hearing that Lee Scott may in fact be on a sort leash from the Wal-Mart board…and that it is critical for him to move the company – and especially the stock price – if he is going to keep his job.
One person familiar with the company’s internal workings suggested that this is the reason that John Menzer was brought back to the US from his global post – it is a message to the company that if Scott cannot get it done, his replacement is just down the hall (metaphorically speaking – we’re not sure where his office actually is).