Walmart, one of America's multinational
retailer corporation, ranked as the 3rd world largest corporation by Fortune
Global 500, with 2 million employees worldwide.
Walmart is a family owned
business, owned by the Walton family which have a 48% share in the company.
Walmart was founded in 1962 by
Sam Walton.
Walmart was not Sam Walton's
first experience with the details that accompanied retail marketing. Sam Walton
began his journey at the J.C. Penney Store, then later met the Butler Brothers
who at that time owned a chain of stores called Ben Franklin.
Sam Walton obtained a franchise
and opened a new Ben Franklin which he called Walton's Five and Dime.
Walton's Five and Dime was a
big success for Sam Walton as a result of the strategy he used; he attained
high sales volume by marking up slightly less than his competitors.
The key to success had been
found and Sam Walton decided to take it to the next level.
And on July 2, 1962, the first
Walmart was opened and the same principles and strategies used previously were
put to play again and this time it created a snowball effect of greater
success.
In 1967, Walmart had expanded
to 24 stores around the US and had reached $12.6million in sales.
In 1970, Walmart had 38 stores
operating in the US with 1,500 employees and sales of $44.2 million.
In 1972, Walmart was traded on
the New York Stock Exchange.
In 1975, Walmart had 125 stores
operating within the US and 7,500 employees and $340.3million in sales.
In 1980, Walmart had increased
exponentially with 1,198 stores recording $15.9 billion in sales and 200,000
employees and went further to launch its $24 million satellite network to link
all its stores together.
The simple strategy it put in
place catapulted it to greater height and by 1995 Walmart opened stores
overseas.
Walmart had grown so big that
the business world had to take notice and in 2002, it was listed for the 1st
time as America's largest corporation with revenue of $219.8 billion and profit
of $6.7billion.
Walmart earned the respects
even in groceries,as the largest grocery retailer in the US, generating 51% of
the $258 billion in grocery sales in the US in 2009.
Walmart is a perfect example of
how powerful a simple marketing strategy is and here is proof; it operates
8,500 stores in 15 countries under 55 names a few of which are:
· Walmart in US
· Walmex in Mexico
· Asda in the UK
· Seiyu in Japan
· Best Price in India
· Walmex in Mexico
· Asda in the UK
· Seiyu in Japan
· Best Price in India
But...
Its sad to say that despite how
perfect a marketing strategy could be there are always factors beyond your
control that may affect its effectiveness and in most cases affect your
business.
Here's an example with Walmart:
In the 1990s, Walmart made a
bold move to venture into Germany and use the same strategy that had worked in
the US. Walmart purchased Wertkauf's 21 stores for €375million and also
Interspar's 74 stores for €750million.
But every attempted foothold in
the German market failed, for the following reasons:
1.
The German market was highly competitive with several companies
using the "low price" strategy Walmart uses, giving them no
competitive advantage.
2.
Walmart received a bad public reputation as a result of its corporate
culture and statement of ethics which prohibited relationship between
employees.
After suffering several blows,
Walmart bowed out of the German market after recording an estimated €3 billion
loss, and sold its stores to Metro; a German company.
This story leaves me with one
question; Is there such a thing as a Perfect Market Strategy?
I doubt it.
In marketing, there's no such
thing as a one-size-fits-all approach... its naïve to think it ever exist. Its
an illusion created in boardrooms over coffee but reality is always reality.
After thinking up your
strategy, have in mind one thing; the flaw.
Its not because you didn't do
your homework well, its just circumstances you have little or no control over.
You win some, you lose some.
You might have lost the battle,
but just be sure you don't lose the WAR.
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