Walmart’s new ad campaign says that the store saves the average American family $2,500 a year. What is doesn’t say is that you don’t actually have to shop at Walmart to take advantage of the savings.
The study that Walmart is citing in their ad showed that competition from Walmart lowered prices and saved the average family some serious money, regardless of where they actually shopped. Also, Walmart isn’t mentioning that after wage depression, the net increase in purchasing power averages only $1,122 annually.
Still, the way the ad is presented may lead consumers and even major media outlets to believe that in order to save money you need to shop at Walmart.
From Ad Age:
“The report does talk about the impact of Wal-Mart on the communities where the retailer is located,” a Wal-Mart spokeswoman said.
She said the ads and Wal-Mart press releases do not specify that people need to shop at Wal-Mart to get all of the savings. That’s a distinction that has been lost, however, in much of the news coverage of the campaign. Media outlets including ABC’s “Good Morning America,” The Washington Post, Advertising Age and The Honolulu Advertiser all have reported in recent months that the report said shopping at Wal-Mart saves the average family $2,500.
In an e-mail, a Wal-Mart spokesman said it is “ridiculous” to believe it’s “some kind of surprise” that people don’t need to shop at Wal-Mart to realize the $2,500 in savings. “In 2005 we held an economic-impact conference in Washington to air these very issues,” the spokesman said. “Just the very presence of Wal-Mart saves Americans an average of $2,500 a year whether they’re Wal-Mart shoppers or not. We’re very proud of that. But of course, the more you shop with us, the more you save.”
What Wal-Mart Savings Claim Doesn’t Tell You [Advertising Age]
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@yahonza:
Then I should have used the phrase further limited.
Alot of people I have encounted would like to see “more” limits places, from everything from who is allowed to run, to who can vote, and to reasons why someone can or can not vote, etc.
That’s so much BS. Competition in general and the availability of online goods all save a lot of money to everyone. Walmart didn’t great competition. Perhaps target and price choppers did ?
Neither one of these numbers make much sense to me. How does Walmart know that IT is responsible for saving $3500 per family per year. I have no doubt that competition and efficiencies have driven the price of consumer goods down over time, which is a good thing, but could you possibly know how much to attribute to Walmart?
@Scuba Steve: WTF? Did you wake up this morning in 1931 or something? Get some perspective.
How hard is it to believe that people don’t shop at Wal-Mart? I don’t. I can think of one time I stopped there and that was because my husband and I had been at a park where we got scraped up and were in real need of Band-Aids and Wal-Mart was our only option. If we hadn’t been bleeding, we wouldn’t have gone there. That was a few years ago, though.
@sonnymooks: but, wait, I’m confused. Isn’t the problem that the people who get taken in by these obviously not wildly intelligent or challenging marketing campaigns are the type of people who don’t have the ability to think for themselves. If someone tells them WalMart will save them money, they shop at WalMart. Is that democracy?! Really?
@Stan LS: Let me see if I can explain in more simple terms.
I happen to use a brand of electronics that many mock for being overpriced, but actually outperforms other brands in Total Cost of Ownership comparisons. So I’m willing to pay more initially, because it means that I will ultimately pay less than if I’d bought a cheaper competing product.
It’s sort of the same concept – all good things have associated costs, some quantifiable, like wages and infrastructure, others less immediate or quantifiable, like shorter obsolence cycles, compromised safety and quality standards, etc.
Look, this isn’t an anti-Wal-Mart screed. I concede that the $2,500 savings are nothing to sneeze at. But once you factor in the quantifiable costs, and depending on what you value, and how you value some of the intangibles, the net value of the $2,500 savings is diminished to some degree.
You clearly value pricetag savings above all else, and that’s fine. But is it that hard to see how a rational person can disagree and think that $2,500 number isn’t as shiny as Wal-Mart wants us to believe?
You couldn’t PAY me to set foot into a walmart. Yuck, yuck, double yuck. No lead or nasty skin burning chemical filled items for me or my family thanks!
It’s easy to talk about how you wouldn’t shop at Wal Mart, but I would bet that most of you are full of it.
@SpecialEd: Seriously? You honestly can’t believe that there are people that don’t shop at Wal-mart? Why not?
Unless you live someplace where Wal-Mart has little to no competition it isn’t impossible to avoid Wal-Mart. They don’t have anything I’ve needed that I couldn’t get someplace else. They’re not even closer to where I live. For me it isn’t even about avoiding Wal-Mart, it’s why would I bother going out of my way to shop at Wal-Mart.
@Consumer-X:
On paper it drives innovation and productivity. Just as on paper socialism makes everyone happy and secure.
But in actual practice this is not always the case. The destructive competition that Walmart leads forces innovation primarily in cutting costs which often results in poor quality (how much of the savings is lost to having to replace once-durable items every year?). They drive everyone to reduce production costs which lately means sending production overseas and plays a part in the waning US economy. Wal-Mart has the financial power to sell products at a loss just to get people in their doors and to stay out of their competitors’ doors.
In both straight capitalism and straight socialism you are hamstrung by the fact that humans have to be involved. Humans that are sometimes evil and/or greedy and sometimes need to be checked.
I’m not so much anti-Wal-Mart as I am Pro-Keeping-The-Other-Guys-Around. Whether the “other guy” is Target, or my local butcher. If everyone shopped at Wal-Mart, all we would hae is Wal-Mart and that’s far from what capitalism should be.
Just HOW does Mal-Wart save the average family $2500? Which families spend enough on the type of crap Mal-Wart sells to save $2500? Lower prices, in Mal-Wart’s case, = lower quality, which requires consumers purchase more crap because it’s wearing out sooner.
@SpecialEd: I haven’t bought a single thing from a Mal-Wart in well over a year and don’t miss the dehumanizing treatment by demoralized employees and inept managers, nor the filthy stores and trashy people Mal-Warts tend to attract.
I’ve long commented on this blog that I want good service and am willing to pay for it — and I really do. In the long-run, it’s cheaper. The stores which focus on service depend upon repeat customers, not volume, to keep them in business. Therefore, they can’t afford to offer poorly-made sweatshop crap, nor can they afford to have unhappy (underpaid/mistreated) employees. The benefit to me is that I get goods which are of high quality and will last far longer than some cheap discount-store product, so I’m getting more for my money and spending less. It’s no secret that manufacturers have a different (cheaper) line of products they send to Mal-Wart, because that’s how Mal-Wart wants it.
Walmart has its advantages.
It’s pretty much the only place open after 10 p.m. Also, if you live in a college town, there’s usually a lot of cute chicks walking around inside. Along with the mandatory 500 pound woman on a scooter. I think that Walmart keeps them in the back. Considering the way some of those college girls behave, I can’t help but wonder if the scooter lady is meant to be a warning, like a Ghost of Partying Past. Anyway, maybe it’s just that the Walmart here is nice compared to most, but I don’t see what the big deal is about the place.
Oh, I forgot, gotta be cool. Walmart sucks! I’d much rather pay more for all the things I buy on a college student budget in order to stick it to The Man! I’d much rather give all my money to another The Man who pays the same wages to all his employees and also imports all his good from psuedo slave labor in China as well!
Um, unless the parents in the family happen to work at Walmart and depend upon Walmart wages. Or unless the parents happen to work at a store that Walmart put out of business with their “low, low prices”. Or unless you got pregnant because the Walmart pharmacy was the only pharmacy in your small town and refused to dispense birth control and now you have to have an expensive abortion or an expensive baby.
This number takes into account Walmart’s effect on prices, but not Walmart’s overall effect on local economies.
Thenino85, catch a clue. Dissatisfaction towards Walmart isn’t about “being cool”. It’s about giving a shit about human rights and dignity. And while Walmart shoppers do save money in the short term, they also participate in devastating local economies.
THANK YOU Walmart. They saved me at least $2000 a year on prescription medications alone. Pravastatin and Lipitor costs $160/month at CVS/RiteAid/Walgreen but goes for only $4 at Walmart.
strangely, i would prefer to have walmart scraped off the face of the earth and not save that money. they are just too evil.
@Shred: “while Walmart shoppers do save money in the short term, they also participate in devastating local economies.”
Funny, every Wal Mart I have ever seen has been surrounded by other businesses. Please point out where those Wal Mart stores are that are surrounded by smoking craters. Urban legends are fun and entertaining but facts are more important in serious discussions.
@Consumer-X: Innovation and quality don’t arrive from wal-mart, dell, micro$oft, or iPods, they contribute the other way, to REDUCE Innovation, quality etc…
Walmart is the UGLIEST corp ANYWHERE. I particularly REFUSE to buiy anything from wal-mart unless I can’t find it elsewhere.