Wal-Mart Stores CEO Doug McMillon likes to keep an article from Fortune Magazine that was written in 1996 to remind him of how his company plans to navigate the future of customer engagement and customer experience.
“I shared an article from Fortune magazine that I keep in my office titled, ‘Can Wal-Mart Get Back the Magic?’’’ McMillon said during the company’s Aug. 18 second-quarter earnings conference call, according to Seeking Alpha. “It’s a pretty strong indictment of our future. And the fun fact is that it was written in 1996. Just as it was in 1996, we will win the future of retail if we make the right choices as a business. We have a strong point of view on what that future will look like.”
What does that future look like at Walmart?
“Through technology, data and mobile we have incredible new ways to serve customers today and the opportunities are only growing,” McMillon said. “We believe the winners in retail will be those who can bring together the best of the offline world with the best of online to serve customer however they want to shop and we believe Wal-Mart has unique competitive advantages in this race.”
Walmart’s strategy starts with running great stores and clubs, McMillon noted.
“In Denver, we talked about the choices we’re making as a business, as you know in the first quarter we initiated a comprehensive multi-year plan to increase starting wages and training for associates in our U.S. stores and clubs,” he explained. “During the second quarter, we implemented the next phase of changes to our Wal-Mart U.S. store structure, including adding department managers. Our focus on running better stores that are clean and well stocked, have friendly associates and an efficient checkout, is resonating with customers. They have always counted on Walmart to have great prices. Now we are building their trust with better in stock and delivering an enjoyable shopping experience. As a result, Walmart U.S. delivered its fourth consecutive quarter of positive comp sales as overall net sales grew nearly 5%.”
Another piece of Walmart’s strategy centers on ecommerce.
“Our plan to win is to build and run great ecommerce,” McMillon said. “We have made a lot of progress improving our mobile and ecommerce capabilities this year with several important milestones in the second quarter.”
In the second quarter, Walmart’s worldwide ecommerce sales grew approximately 16% on a constant currency basis led by solid results in both Walmart and Sam’s Club. McMillon noted that company officials are encouraging store pickup options for customers.
“The third leg of our strategy is to innovate the future retail by bringing online and offline together,” McMillon said. “Here we can see the pieces starting to come together. In the U.S., the response to our grocery home shopping offering has been strong. I’m particularly pleased with the number of repeat customers we have and the strength of our average ticket. Anecdotally, I can share that customers have told us it’s changing their perception of the shopping experience at Walmart.”