Wal-Mart, which was founded in 1962 by Sam Walton, is the largest retail operation in the world today. According to the Wal-Mart corporate website (http://www.walmartstores.com), the company's net sales totaled $344,993 million for the fiscal year ending January 31, 2007, which was an increase of 11.7 percent over fiscal year 2006. Wal-Mart Corporation's consistent profit generation make them a good model for other businesses to emulate.
I believe that Wal-Mart is successful due to a number of factors with the most important factor being their dedication to their customers as well as offering them the lowest price possible for their products. The concepts and practices of Wal-Mart can be found right in a statement of its three core beliefs. These are the beliefs that Sam Walton founded the company upon and they remain in practice today: Respect the Individual
Service the Customer
Strive for Excellence
In an open letter to the public from Wal-Mart President and CEO, Lee Scott writes "At Wal-Mart, we save people money so they can live better" which shows their true dedication to consumer needs. They also utilize both detailed market research and customer segmentation to better deliver against customer needs and expectations. They do this by identifying the needs of their customers and deciding if or how they will implement their findings. They also tailor their merchandise assortment and store experience to meet the specific needs of a broader customer base. Wal-Mart is not a store for one specific age group, it has something to offer all age groups. All of these factors are extremely important in their success because without the loyalty of their customers, Wal-Mart would not be one of the most successful retail operations today.
The retail world is difficult for a business to survive in. Wal-Mart competes with stores like Target and formally K-Mart who underwent a Chapter 11 reorganization. Target has managed to stay afloat, but it hasn't seen growth anywhere near that of Wal-Mart. How is that possible when both Wal-Mart and Target sell basically the same things and yet Wal-Mart consistently outperforms Target? I believe the answer can be found in Wal-Mart's values, marketing activities and their desire to continuously improve their services in order to meet consumer needs.. Wal-Mart values the idea of offering the consumer the lowest possible price for their products and merchandise. They call this policy EDLP which stands for "Every Day Low Price". The idea is simple because consumers don't need to wait for a sale to shop at Wal-Mart since they are getting the lowest price available every day. Anyone who has ever visited Wal-Mart store knows that the store is large and they carry a wide variety of merchandise. Therefore, people find shopping at Wal-Mart to be very efficient and cost worthy. They make one stop and have all of their needs met at the best price available. Wal-Mart is incredibly successful by making itself into a commodity and is recognized as the place to go for the best price.
There are three separate strategies that Wal-Mart implements that I would like to discuss: Market penetration, market development and product development. The market penetration strategy is when a company is seeking to increase the market share for present products or services in present markets through greater marketing efforts. This is an appropriate strategy for Wal-Mart to implement because they cut down on the competition by saturating...