Wal-Mart's Continued Success

Topics: Marketing, Fortune 500, Good Pages: 2 (527 words) Published: April 20, 2013
Wal-Mart’s winning strategy is based on selling well known consumer goods at lower cost, which has allowed the lower and middle class consumers to obtain the products they desire at a very competitive price. One way Wal-Mart has ensured its continued success was through marketing strategies that guaranteed “everyday low prices” as a way to attract customers, allowing consumers to purchase goods at a “sale” price that was lower than the competition. The prices of goods were able to remain low largely by having a higher volume of goods readily available. In addition to larger volume, a high percentage of imported goods helped keep prices at a minimum. In 1995, Wal-Mart estimated that 6 percent of its total merchandise was imported. A decade later, experts estimated that Wal-Mart imported about 60 percent of its merchandise. Technological innovations have also been a huge factor in Wal-Mart’s success. It pushed the retail industry to establish the universal bar code, which forced manufacturers to adopt common labeling. The bar allowed retailers to generate all kinds of information, creating a shift of power from manufacturers to retailers. Wal-Mart became especially good at exploiting the information behind the bar code and is considered a pioneer in developing sophisticated technology to track its inventory. Technology that has been successfully implemented is Radio Frequency Identification Technology (RFID), and has resulted in a 16% decrease in out-of-stock merchandise, ensuring that the products the consumer needs will always be available. Proctor & Gamble, Clorox, and Johnson & Johnson are some of the big names among Wal-Mart’s nearly 3,000 suppliers; however, Wal-Mart is careful not to become too dependent on any one supplier. As a result, no single vendor constitutes more than 4 percent of its overall purchase volume. The frugal culture, established by Walton, also plays into Wal-Mart's success. The company has been criticized for the meager...
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