Blog

Walmart rebranding?

September 6, 2013 by Dale Furtwengler — President, Furtwengler & Associates, P.C.

Are Walmart's steak ads early signs of a rebranding? I've been a long-time critic of Walmart's low-price strategy so it's only fair that I recognize them for what they're doing well if they are, indeed, rebranding.

Here are some takeaways from Walmart's "rebranding":

Do, don’t talk

If you want to rebrand don’t talk about it, just do it. The more that you talk about what you’re going to do to rebrand yourself, the more your existing customers are likely to feel betrayed or abandoned. At the same time potential customers are likely to be distrustful. In Missouri, we call that the ‘show me’ mentality.

You need look no further than JCPenney for evidence of how miserably a rebranding strategy can fail. As of this writing JCP just reported another quarter of declining sales and profits as well as considerable shrinkage in its cash reserves.

Walmart’s steak ad campaign, as well as the endorsements (I’m assuming paid endorsements) on programs like MasterChef, shift consumers’ attention from price to quality and image. Steaks, especially exceptional steaks, are pricey. By focusing customers’ attention on high quality steaks Walmart creates a new feel — one that resonates with quality, value buyers.

Be consistent 

Continue to talk about the perception that you want customers to have instead of the one they previously held. In Walmart’s case that means talking about quality and image, not prices.

What Walmart will want to do is choose other high-end products to highlight. This will send a message of ‘consistent’ quality throughout their product offerings. This approach will attract a broader array of customers who desire high-end offerings.

Another benefit of being consistent is avoiding multiple personality disorder. Psychologists and psychiatrists tell us that people who develop multiple personalities typically do so to deal with internal conflicts. The same is true for organizations.

There will be a natural tendency (desire) on the part of Walmart’s leadership to retain their low-price marketing messages while rebranding. If they attempt to do so they’ll create an internal conflict that will appear to the market as multiple personalities. They’ll no longer have an identity to which customers can relate. In that situation customers tend to shy away because they don’t know what to expect.

Walmart needs to abandon the low-price ads in favor of the quality, image ads if they are indeed rebranding in that direction.

Lessons

If you want to rebrand your organization:

• Don’t announce your intentions.
• Gradually shift your customers’ and the market’s focus from your old image to the new one.
• Be consistent in your messaging to the market.
• Don’t revert to the old theme; it’ll confuse the market and drive existing as well as potential customers away.
• Reap the benefits of an effective rebranding.

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