It’s very telling that every Walmart greeter has an inviting phrase emblazoned across the back: “How may I help you?” That simple question and the presence of the greeters in the stores speaks eloquently to the customer-centricity of Walmart, which has been instilled in their organizational culture from the very beginning by their founder, Sam Walton.
What’s interesting about that customer centricity is how their EVP and CMO Stephen Quinn describes its central role in driving innovation at the retail giant. As business over the decades has transitioned through the manufacturing era, the distribution era and the information era, we are now undeniably in the customer era.
The customer is the boss
Want proof? Look no further than the improbable success stories of Gangnam Style and Duck Dynasty. Gangnam Style is the song and video global smash of 2012 – which sprang out of Koren pop music with a silly, strangely compelling dance and video. Duck Dynasty began as a quirky reality TV series in the USA based on the daily issues and antics of a family of duck-call manufacturers in small-town Louisiana. Still doubtful? Quinn says that WalMart sells “hundreds of millions of dollars” of Duck Dynasty-themed merchandise in its stores. Hey! That’s “SI-rious” evidence right there, if you ask me! No marketer could have ever promoted their way into that kind of success – it happened organically because customers were the ones who made the choice.
For Quinn, it isn’t simply about customer centricity, but it’s also about how that viewpoint informs an enterprise growth strategy and channeling the resources to make it happen. That’s the role of marketing in his view. It’s about being purpose-driven in a way that’s relevant and valuable for the customer. And just as people change and families change, peoples' idea of what’s valuable changes as well.
What’s valuable for Walmart’s customers has as much to do about low prices (the positioning that Walmart has owned for years), as it does about what those low prices enable. It’s about not ignoring the fact that 60% of the families in the United States live on 25% of America’s income, and knowing that Walmart's low prices help people make ends meet. That’s where the value is for the Walmart customer. That's also where the value lies for Walmart because the customer is their source of innovation.
The idea that innovation comes from the customer is not new. Per Quinn, it goes all the way back to Sam Walton, the entrepreneur-innovator who founded the company. It also continues today as the customer drives innovation for both retail and technology and by extension, for busines. Citing a recent Wall Street Journal Article that makes the same point, “The Most Destructive, Unpredictable Force in Tech,” Quinn described how the people who mess up their displays, make demands at their check-out counter and keep coming back week after week are the ones who drive innovation.
And what matters to the customer is what should matter to marketers.
So how does it happen at Walmart? Quinn offered an interesting allocation of marketing resources for innovation:
- 70% of resources devoted to the proven business drivers,
- 20% focused on new programs and growth areas, and
- 10% dedicated to “what’s next.”
As an individual, I don’t consider myself a “Walmart shopper,” for all that might mean. Part of that has to do with the division of labor in our house. But I admit that the new Walmart smartphone app he described is pretty slick and I think my lovely, techno-nerdy wife might really like it. The voice-activated grocery list builder that also allows you to scan barcodes of your pantry items running low is really cool. I also like that when you arrive at the store, the in-store mode alerts you to any specials like “roll-back” items or similar items.
Use customer data to get there
For any business bigger than a mom-and-pop shop, knowing the customer and being purpose-driven comes from using customer data to get the necessary insights. Marketing analytics are what can provide the details needed for an effective strategy. A previous blog post, titled Four ways Walmart uses analytics, gives a nice view of one way it’s happening at Walmart
So consider your own organization. You might call them the end-user, the patient, the member, the guest, the patron, the client, the consumer or simply the customer. If you want to grow and innovate, then market like Walmart and start by double-checking your marketing messages. Are they speaking to the issues and concerns of your customers? The answer to that question should tell you where to take it from there.
Stephen Quinn, EVP and CMO of Walmart spoke at the 2013 Masters of Marketing Conference of the Association of National Advertisers – an event SAS is proud to be a sponsor of, and an organization that SAS is proud to be a member of.