02/24/14 by Rennie Detore
Have you ever wondered how Wal Mart was so incredibly successful?
Seems like a simple enough question, especially when you consider the staggering statistics associated with the retail juggernaut. They're the largest retailer in the world, currently have thousands of stores worldwide and their revenue is in upward of 400 billion dollars.
That should pretty much answer the aforementioned question with relative ease, but in the midst of an economy that isn't fantastic and a consumer base that is trying to conserve money at every turn, most companies are struggling to stay relevant and turn a profit.
Except Wal Mart. That is, until recently.
Wal Mart has a new chief executive, Doug McMillon, who is aiming to help Wal Mart recreate its niche in the retail market, opting for smaller stores in place of the super stores. The year 2014, the first quarter anyway, isn't panning out quite like Wal Mart planned, prompting McMillon to reconsider the business plan to a degree.
Wal Mart scaling down its store floor plan and creating a different, more intimate shopping experience, might be the change the retail needs. In fact, it's badly overdue. It's not as if Wal Mart and its slumping revenue can't be turned around promoted by the right idea.
Reinventing their stores and image might be the most apt place to begin, and that starts with Wal Mart wanting to cater to a changing customer base.
And for that reason, Wal Mart will rule again. The ability to alter your thinking within the confines of a business plan puts you well ahead of a more stubborn sector of retailers that think fixing something they feel isn't broke is ridiculous.
But even implementing smaller stores won't change two basic principles that have worked for the retailer for years: convenience and price. The smaller version of Wal Mart might include gas stations or fresh fruit stands, giving it a trendier, market fresh feel to it.
In the end, Wal Mart will always focus on a less expensive, one stop shopping mentality that allows customers to visit and buy everything within the confines of their store. They just determined they might not need as much space as once thought.
To McMillon's credit, he also wants to add even more to a sector of Wal Mart that is flourishing: the online crowd. Those sales figures have risen quite nicely for the retailer, which isn't quite the same tune most retailers are humming.
Even would be strong, unstoppable entities like Best Buy, Target and Sears can't quite maintain or capture momentum the way Wal Mart does. Best Buy, as an example, serves as little more than a glorified showroom for perspective Amazon.com customers. Anyone interested in buying a tablet, computer or even a DVD heads to a physical Best Buy store, sees the product in person and runs home to buy it for less on Amazon.com.
But Wal Mart doesn't quite have that problem, mostly because their pricing is highly competitive and comparable to Amazon.com. If Wal Mart plans to add to its online business by making it better, how's that a bad thing?
To even further their brand extension, Wal Mart and McMillon have tested the idea of delivering groceries and the initial reviews have been overly positive. Once again, Wal Mart and its new chief officer aren't relying on its namesake, nor is the retail giant simply adopting a "business as usual" mantra, assuming its second quarter earnings will change without them doing a thing.
Figuring out what makes Wal Mart so powerful and potent can be traced to a simple philosophy of offering everything you need at a price you can afford. Altering the size of the store and lessening the square footage is an example of changing with the times, and fitting into a mold that customers want.
Easily the mark of a business and brand that isn't content on complacency.
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