WalMart Goes Upscale


In a move that every retailer seems to try eventually, WalMart is trying to be more upscale.

The world's largest retailer opens a first-of-its-kind "laboratory" store Wednesday in this city, with the purpose of studying how to entice shoppers to consider Wal-Mart for more than everyday essentials. A more upscale Wal-Mart with a specialty-store attitude, it carries premium products and services not found at a typical Supercenter.

Is this a good move? No. It sounds good because WalMart is thinking 'higher margins, bigger spenders, etc.' but they are forgetting that people equate WalMart with cheap.

Laura Ries has an analysis and thinks WalMart would be better off splitting this into a new brand. Check out the Q&A section at the bottom of her post.

  • J

    “Is this a good move? No. It sounds good because WalMart is thinking ‘higher margins, bigger spenders, etc.’ but they are forgetting that people equate WalMart with cheap”

    Having lived in this area several years, I disagree in the case of this particular store. The question is whether WM is going to assume that what applies in the north Dallas suburbs can be carried over to other markets. I lived about 5 miles north of this site in Frisco, and when I left there were at least six supercenters within 10 miles of my home (and two within three miles). I’m not sure if ubiquity is the reason why, but it was interesting when I moved to an Atlanta suburb to discover that shopping at WM carries an entirely different connotation in GA versus TX. First, my GA neighbors act as though nearly all WM customers are at the poor end of the econ scale – the parking lot of the Preston & Park WM this store replaces routinely had one of the largest BMW/Mercedes/Lexus collections on earth. In Dallas there simply is no stigma about shopping there. Second, this is an area where shopping is the local pastime, but folks aren’t interested in blowing it at places like Saks or Swarovski (ask Taubman about the Shops at Willow Bend, across the tollway from this store). I think this store will do fine. You may think the whole concept is silly, but I guarantee you the Whole Foods market at Preston & Park (a couple miles east) is shaking in their boots. I agree this concept might not work in Atlanta and probably many other markets, but in Plano they’ll do just fine.

  • J

    SOme other things from the article:

    “The 203,091-square-foot store has the chain’s only sushi shop, more than 500 organic products and a wine department with more than 1,000 varieties ranging up to $500 a bottle. It features a Wi-Fi-ready Kicks Coffee CafĂ© at the front of the store and a kiosk in the meat department that prints recipes and shopping lists”

    You know who else sells $500 bottles of wine? The Costco on the other side of the tollway. In fact, the “stuff WM doesn’t usually sell” list in the DMN article looks supiciously like a “stuff Costco sells” list.

    “Nearby homeowners who opposed the store during a contentious City Council battle have shifted their focus to work with Wal-Mart and the city on softening the neighborhood impact”

    Gack. I think this plot of land was zoned commercial retail shortly after the Battle of San Jacinto. What’s the matter with people who buy homes next to a retail development zone then complain about retail development?

  • “Claptrap”, “Pulls this stuff out of her self serving hat”?? Oh my.

    What makes me think I know what I am talking about is that I have studied thousands of companies, I have consulted with hundreds of companies, I have written several bestselling books on marketing and learned about marketing from the master and my father Al Ries.

    The softer side of Sears has failed, that is a well-known fact.

    My prediction is that Wal-Mart will fail as well in trying to appeal to a more fashion conscious consumer. Because the brand is not consistent with fashion in the mind of the consumer.

    But I am happy with CEO Scott Lee and his recent PR efforts. You can read more on my most recent post.

    However if you think branding is quackery, then best of luck to you. But success without a strong brand is going to be tough if not impossible in this day and age.