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Wal-Mart's New Infatuation and Its Old Flame
At a prototype store in Plano, Tex., Wal-Mart is conducting an experiment in upscale shopping. But executives insist they aren't abandoning bargain hunters.
(By Amy Conn-gutierrez -- Associated Press)
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Michele McKnight of Rogers is a real-life Karla. She goes to Wal-Mart about five times a week. On a recent afternoon, she pushed a cart through a Wal-Mart here as her three sons roamed the toy aisle. It was 7-year-old Quinton's birthday, which meant he got to pick out any toy he wanted under $10.
She had intended to just run in for trash bags and deodorant. But as usual, her cart just seemed to fill itself.
"If you look at my checkbook, it's Wal-Mart, Wal-Mart, electric bill, Wal-Mart," she said. "Anything that I buy, I get at Wal-Mart."
She's not kidding. Quinton's outfit, 15-month-old Zander's pacifier, even her purse are all from Wal-Mart. But when asked about the trendy Metro 7 line, McKnight scoffed. She's a single working mother, she said. She doesn't have time for all that.
Jennifer Alexander, a 30-year-old from Rogers, is more of a Gracie. She browsed through the clothes, absently picking up a pair of pants and sorting through shirts. Most of her clothes come from Cato or Target, she said. She has been losing weight and wants to buy trendier apparel to show off her new self, she said.
For meat, she goes to a local grocery chain because, she said, it's fresher. Wal-Mart is where she gets her cleaning products.
"I try to avoid the place," she said.
Wal-Mart estimates that its most loyal shoppers visit its stores more than once a week on average and spend 77 percent of their grocery dollars there. But more selective shoppers, the Gracies, go to Wal-Mart less than once a week and spend only 28 percent of their grocery budget at its stores.
The retailer is hoping to capture more of Gracie's dollars through stores like the prototype recently opened in Plano, Tex., which sells $500 bottles of wine and premium cheeses. To present its new "affordable luxury" merchandise to reporters, the company hired models, including one leggy woman lounging on a bed in a lace beaded jacket with a glass of wine, a plate of strawberries and some handsome arm candy.
Still, Wal-Mart executives went out of their way to stress to reporters this week that they have not abandoned their traditional customers. In fact, Chief Financial Officer Tom Schoewe said he is frustrated by all the media attention on the Plano store. He said he wished there were as much focus on the store in Evergreen Park, Ill., which has beefed up its supply of ethnic hair care products.
"It's not Plano," he said.
Analyst Marcia Mogelonsky with Mintel International Group Ltd., a market research firm, said she thinks Wal-Mart can cater to both types of shoppers without alienating either because of its unique position as the world's largest retailer.
"Remember, Wal-Mart's scale is huge. Wal-Mart can have both, easily," she said. "They do have room for the whipped-cream drinks and the regular coffee."
Or maybe Wal-Mart's shoppers will be the ones to change. Maybe Gracie and Karla are rubbing off on each other.
McKnight said she has noticed an improvement in Wal-Mart's produce selection. She now buys organic fruit to feed her kids. Once, she said with pride, she even bought mahi-mahi.
"We're not afraid," she said.
