WAL-MART segments shoppers into three groups
WAL-MART segments shoppers into three groups
In an interview with the New York Times, Wal-Mart’s new chief merchandising officer, John Fleming, and new chief marketing officer Stephen Quinn, have revealed how Wal-Mart segments its shoppers into one of three groups. The groups comprise ‘brand aspirationals’ (low-income shoppers who look for low prices on branded goods); ‘price-sensitive affluents’ (higher-income shoppers looking for a deal); and ‘value-price shoppers’ (low-income shoppers who cannot afford to pay much more). ''It explains why people who have to shop here do and why there are BMWs in the parking lot,'' said Fleming. Going forward, all product decisions will be organised around the three groups which, according to Wal-Mart, make up a majority of its business. The company is now ‘fixing’ its merchandising and marketing strategies, and will focus more on existing shoppers rather than on new customers. Mr Quinn noted that shoppers “really need the assurance of brands”. He added, ''In the past we were so focused on low price but low price on what?'' He believes that having just one or two name-brand products in a department is not enough to compete with specialists such as Best Buy or Home Depot. Instead, Wal-Mart must build up a reputation for brands in every category. Mr Fleming added that Wal-Mart’s new strategy was based on research that ‘millions’ of Wal-Mart shoppers only buy household staples.