Will Walmart’s New Ad Campaign Help Its Image?
Walmart’s (NYSE:WMT) newest ad campaign — which focuses on “The Real Walmart” — has led many onlookers to see it as a rebuttal against the recent criticisms aimed against the company on a variety of topics, including factory conditions in Bangladesh and recent reports regarding their use of temp workers.
The $3 million ad campaign, which has shown up on Hulu and other outlets, is being criticized by those who believe the ads are attempting to make the company appear better to the general public rather than making important changes. “We’ve so normalized to corporate identities as ‘persons’ that doing stuff like this PR campaign ends up ringing frightfully hollow,” Zev Eigen, a law professor at the Northwestern University School of Law, says. Eigen, who specializes in labor issues, says the ad campaign appears to him like a lipstick-on-a-pig situation.
Derek Plummer, a spokesman for Making Change at Walmart, argues that the issue of Walmart’s public image needs to start with worker pay. The United Food and Commercial Workers International Union claims most workers at Walmart make less than $9 an hour, on average, which would mean that half of the company’s workers make less than $22,400 a year. That number would put them below the federal poverty line.
Walmart has responded to the criticism by saying that their average hourly wage of $12.57 and their turnover rate — 37 percent versus the 44 percent retail average — are both above U.S. average. Furthermore, 75 percent of their store managers have been brought up from hourly positions.
However, the new Walmart ads pose an interesting question: do convincing ads ever work? Eigen is not so sure. “It’s like Coca-Cola (NYSE:KO) coming out and saying soda is a part of nature. No, it isn’t,” he says. He contends that raising wages and creating ad campaigns around a concrete change can be much better for consumer opinion.
Eigan says that McDonald’s (NYSE:MCD) went through a similar consumer opinion issue when it was under attack for health concerns. As a result of the attacks, McDonald’s changed its menu and began making its nutritional information completely transparent.
Plummer has set up a website in response to “The Real Walmart” at reallywalmart.org where he responds to some of Walmart’s claims. “When you start talking about a company that made almost half a trillion dollars last year, and $16 billion in profit, if Walmart paid its associates $25,000 a year on average, it’d still be making more than [its chief competitors] combined,” he says.