Solutions Drive Wal-Mart's Reinvention

Brent Felgner, May 15, 2006

Rogers, Ark. — Wal-Mart's evolving focus on providing solutions and expanding its core customer base is pulling formerly disparate home merchandise closer together, by style, color and function. The effort runs across basics and the still-developing “mass luxury” entries. In the new Plano, Texas store, for instance, cross-merchandising uses “islander” gondolas and stylized “action-alley” displays, featuring a variety of home products, hard and soft.

The effort exceeds Wal-Mart's past attempts, which were mostly limited to a simple flow of like merchandise on typical gondola runs, perhaps organized by color.

“Give me solutions. I'm a busy woman and I need a lot of help pulling things together,” said Claire Watts, executive vp merchandising and apparel, echoing one customer need. “Give me what I need and what I want,” she added, extending that basics demand to “mass luxury.”

At the retailer's recent media conference here, Wal-Mart displayed vignettes or “room solutions” -- complete with live models -- that romanced the products by lifestyle. For example, a master bedroom had furniture, home accents and lighting, along with top of the bed items including dec pillows, a quilt, throw and bedskirt.

Watts added her own example, citing the growing popularity of outdoor living with a grouping around a patio set that pulled a broad group of skus together.

“In the past ... we would have had six or seven different products and they would have been in different locations in the store. Tabletop would have been in the dining area, plastics would have been in seasonal, and beach towels would have been in another area.”

The vignettes are not in stores — they are space hogs — but the room-by-room lifestyle solutions appear in in-store flip books.

Wal-Mart is also making subtler changes. It is organizing bath accessories, shower curtains and even towels by collection and colorway, even as it massages some better and “luxury” price points higher. The Springmaid Palais, Estate, Chateau, Tudor and Manor collections had towels and embroidered shower curtains ($19.96, a new high) adjacent to an expanded range of accessories such as wastebaskets, tissue boxes and soap dishes.

In bedding, the luxury line is taking shape with a run of Springmaid luxury comforter sets and coverlets filling in the gap between 400- and 350-thread count sheet sets, shown with coordinating dec pillows.

Springmaid luxury window coverings are several aisles away, with full-length panels in groupings adjacent to j-hooked inventory. Wal-Mart typically sets window coverings in short, valance-like displays above gondolas.

Besides its “mass luxury” offerings, the retailer is also honing staples to hammer home the value message. Watts said the this will “bring 'better' to the essentials.” She cited a Home Trends towel, made of ring-spun cotton in a 15.5 lb. weight — priced at $4.24.

Wal-Mart is intent on better serving its consumer segments. Beyond its “loyalist,” “selective shopper” and “skeptic” tags, it has named customer types by demographic and lifestyle, such as: Gracie, Karla, Sandra, Ray, and Jason. These represent style-seekers or lovers of the classics and basics, time-pressed or budget challenged shoppers.

“We're diving deeper into these customer segments so that we can create solutions for them,” Watts said. “These customers are already in our stores. They've told us, 'We find you credible, but you don't always provide solutions that we're looking for.'”

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