The Marketing Mix and Distribution Strategies

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Dear Student,

Thank you for using BM.
Below are my answers.

Sincerely,
Anna Liza Gaspar

ANSWERS
Please see attached file for answers.

PART 1

Walmart Stores, Inc.
Session-Long Project

[Name]
[Class]
[University]

Submitted on:
[Date]

Submitted to:
[Professor's Name]

Table of Contents
INTRODUCTION 3
NAME OF ORGANIZATION 3
MISSION STATEMENT 3
PRODUCTS, GOODS OR SERVICES 4
COMPETITORS 5
POSITION IN THE MARKET 6
COMPETITIVE ADVANTAGES 6
TARGET MARKET AND PROD STRATEGY 8
TARGET MARKET 8
PRIMARY ATTRIBUTES OF TARGET MARKET 8
PRODUCT CATEGORIES 9
PRODUCT-MARKET GRID 10
STRATEGY 11
COMPETITIVE ADVANTAGE/PRODUCT MIX 11
DISTRIBUTION STRATEGY 13
DISTRIBUTION 13
LOGISTICS 14
PHYSICAL FACILITY 15
COMPETITIVE ADVANTAGE/DISTRIBUTION 15
References 16

INTRODUCTION

NAME OF ORGANIZATION
The organization that the researcher is doing the marketing audit/plan paper is Walmart Stores, Inc. (NYSE: WMT). Walmart is considered to be one of the biggest companies in the United States in terms of total revenues and market capitalization which is over 205 billion USD (Yahoo! Finance, 2010). Walmart or Walmart is the company's registered trademark (Walmart, 2010).
Moreover, the company is one of the biggest employers in the world with more than 2 million employees working in over 5,000 stores ((Yahoo! Finance, 2010). These stores include discount stores, super centers, Sam's Club, neighborhood markets, cash-n-carry stores, and hypermarkets among others.

MISSION STATEMENT
The company's mission statement is based on Sam Walton's, Walmart's founder, philosophy. Specifically, he envisioned people working together in order to lower the cost of living for everyone which in turn will give them the opportunity to "see what it's like to save and have a better life" (Walmart, 2010). Walmart prides itself that since it started operations sometime in 1962 it has been operating "with the same level of integrity and respect that Mr. Sam put in place" (Walmart, 2010).
Specifically, the organization aims to:
1. Save people money so they can live better
2. Help customers save money
3. Help people live better (Walmart, 2010).

PRODUCTS, GOODS OR SERVICES
By providing the products, goods and services it carries, Walmart aims to fulfill its mission as stated in the previous section. The list below presents the company's major product categories that it sells. This list is based on Walmart's three business segments as presented in the Management's Discussion and Analysis of Financial Condition and results of Operations in the company's Annual Report to Shareholders for the Fiscal Year Ended January 31, 2009.
1. Walmart U.S.
2. International
3. Sam's Club
The company's Walmart U.S. retail formats include discount stores, super-centers and neighborhood markets (Walmart, 2009, p. 3). A discount store averages 108,000 square feet and carries a wide assortment of general merchandise, but a limited variety of food products. On the other hand, super-centers are almost twice as large as a discount center at 186,000 square feet. This store carries a full-line supermarket and a wide assortment of general merchandise. A neighborhood market is the smallest retail format of the Walmart U.S. segment with 42, 000 square feet. This store offers a full supermarket, but a limited assortment of general merchandise. Hence, it can be said that a neighborhood market is the opposite of a discount center.

The International segment, on the other hand, is the company's operations overseas which, as of the end of the fiscal year 2009, is located in 14 countries. Retail formats for this segment include restaurants, discount stores, super-centers and Sam's Club.

The Sam's Club segment of Walmart is a membership only warehouse club and also supervises an online retail operation. A Sam's Club averages 133,000 square feet.

COMPETITORS
Walmart belongs to the Services Sector and particularly, the Discount, Variety Stores (Yahoo! Finance, 2010). The following companies are some direct competitors with several comparative data.

Walmart Carrefour SA Costco Wholesale Corporation
Target Corp.
Industry

Market Capitalization 209.23B N/A 26.77B 39.72B 3.01B
Employees N/A 4,952,871 79,000 N/A 11.50K
Quarterly Revenue Growth 4.50% N/A 11.30% 3.20% 6.90%
Revenue 408.21B 122.58B1 74.22B 65.36B 5.23B
Gross Margin 25.37% N/A 12.74% 29.29% 30.63%
EBITDA 31.66B N/A 2.66B 6.70B 390.95M
Operating Margins 6.00% N/A 2.53% 7.15% 6.88%
Net Income 14.41B 2.17B1 1.15B 2.49B N/A
EPS 3.697 N/A 2.594 3.296 2.14
P/E 15.06 N/A 23.43 16.3 17.32
PEG 1.29 N/A 1.51 1.06 1.36
P/S 0.51 N/A 0.36 0.6 0.56

(Source: Yahoo! Finance, 2010).
The above data are as of 2008.

POSITION IN THE MARKET
According to the company's 2009 Annual Report its net sales for the recently closed fiscal year increased by 6.8 per cent to $255.7 billion (Walmart, 2009), a testimony of the success of Walmart's marketing strategies and tactics. Particularly, a customer survey made by Walmart showed that several factors are bringing more customers to its stores and driving increases in same-store traffic: faster checkouts, friendlier associates and cleaner stores (Walmart, 2009). Clearly, some of these factors were a product of the company's marketing strategies and tactics.
Based on the performance of the organization, and the competitor analysis presented in a table in the previous section, Walmart is positioned strategically relative to its competitors. Strategic in the sense that its marketing strategies are geared towards achieving the company's mission statement and its strategic goals and objectives based on this mission.

Based on its financial performance, Walmart's ability to satisfy the needs and wants of the market is much more superior to any of its competitors.

COMPETITIVE ADVANTAGES
Doing better in the marketplace, specifically in an industry as dynamic as the retail industry, both in the short and long run means a continuous development of an organization's competitive advantages. Walmart has perfected this process.

One of the competitive advantages of the retail giant is its ability to train it employees understand and act out its mission statement and corporate values. According to Colin Mitchell (2002), companies usually tell their customers what make them great, but rarely invest resources to ensure that its employees know (p. 1). At Wal-Mart educating employees or associates on what makes the giant retailer great is a key cornerstone of its marketing strategies and tactics. This is the concept of internal marketing which puts together the different elements of marketing - product, place, price and promotion - in a cohesive mix such that employees can "make a powerful connection to the products and services" (Mitchell, 2002, p. 1) an organization and hence become much more effective in selling these ...