Walmart Reverses Brand Strategy

The retailer decided to put 300 name-brand products back on the shelf after customers complained.

March 23, 2010

BATAVIA, Ohio - Walmart has changed its mind about national brands after customers complained about the absence of hundreds of name-brand products, Advertising Age reports.

Last year, the retailer reduced the number of brands to lower inventory and increase margins to provide a better shopping experience to customers. But after hearing from consumers about how "aggravated" they were with the reduction, the discounter is bringing back 300 name brand products and eyeing other categories from which it had culled brands.

"We did discontinue some things that people didn??t buy very often, but were aggravating to a customer to lose," said Bill Simon, Walmart U.S. COO, during a conference call to investors. "And, you know, [former CEO and current board member] Lee Scott told us recently, rule number-one in retail, don??t aggravate your customer."

Walmart??s traffic dropped during its fiscal fourth quarter, with sales declining for the first time ever. In 2009, Information Resources Inc. found that the retailer lost packaged goods share for the first time. Simon said the retail chain had stopped stocking products that weren??t selling well or were purchased rarely.

"Mostly in food and consumables, there were flavors, items, sizes that customers are very accustomed to and...liked very much, and we disappointed them by taking those out, and we put them back," he said.

The number of restocked products was "a small percentage" of what had been discontinued.

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