It turns out that – and nobody could have guessed this – Wal-Mart customers want basic goods at low prices. Who knew? It seems they aren’t interested in paying extra for organic, green products or brand labels. Lately Wal-Mart has been trying to convince its customers that they should want the same stuff members of the cultural elite want. It hasn’t gone well.
Wal-Mart Stores Inc. will begin a promotional campaign next month called “It’s Back,” telling core customers the chain is restoring merchandise it removed from store shelves in a botched effort to sell them stuff the cultural elite said they should want.
Trying to turn Wal-Mart into Target was the brainchild of Leslie Dach, a leftist former senior aid to Al Gore. Dach spent his entire career in politics which, for some reason, led Wal-Mart to believe that he would be perfect to muck around in and make changes to their wildly successful business plan. He presided over a major change in the culture and products of the chain of stores. Predictably, he failed miserably.
He figured that what the people of Wal-Mart really wanted wasn’t inexpensive basics. They wanted upscale products, designer labels and organic food choices. Dach, of course, was making the most fundamentally rookie mistake possible in marketing: He was projecting.
As a member of the liberal elite, he didn’t approve of Mountain Dew, fishing tackle and sweat pants and neither should Wal-Mart shoppers. What he really wanted was organic arugula, green cleaning products and designer clothing. If he wanted that stuff, it is certain that everyone else would too. He was wrong. Profoundly wrong.
Starting in May, Wal-Mart shoppers in the U.S. will see signs in stores heralding the return of fishing tackle, bolts of fabric and other “heritage” merchandise that Wal-Mart reduced or cut out altogether as it attempted to spruce up its stores to appeal to more well-heeled shoppers.
That strategy failed, and the Bentonville, Ark., retail giant now is pursuing a back-to-basics strategy to reverse the company’s fortunes after seven consecutive quarters of sales declines at U.S. stores open at least a year.
Why would Wal-Mart put themselves in the hands of a political hack with no retail or marketing experience? Because they were attempting to appease the American liberal elite. Wal-Mart is a the bugaboo of American leftists and a target of attacks in the ongoing culture war. Wal-Mart thought if they compromised with the left, they would back off. They found that the left didn’t back off but their customers did. Stores like Dollar General have exploded in popularity since Dach joined Wal-Mart. Wal-Mart is now correcting their mistake and returning to their tried and true roots.
Of course this is a terrible set back for Dach’s career, right? Making a rookie mistake regarding the fundamentals of marketing – knowing your customer and knowing your niche – is the sort of thing that you pay for dearly, right? Yeah, not so much.
[Dach] was given three million dollars in stock and a hundred and sixty-eight thousand stock options, in addition to an undisclosed base salary. He and his wife, a nutritionist, recently bought a $2.7-million house in the Cleveland Park neighborhood of Washington. He commutes to Bentonville during the week, to an apartment furnished out of a Wal-Mart store.
Yep. That was predictable too. The one aspect of American business that I have never been able to master is the part where you attain great wealth whether you succeed or fail miserably. In my career I have seen many fail and walk away far wealthier than I will ever be.
Of course I am at a disadvantage. I am not temperamentally suited to be a politically correct, crony capitalist, profiteer engaged in cynical social engineering as the means to curry favor with the leftist cultural elite. That means, unlike Dach, I have to actually, you know, sell product. That is just my cross to bear.