Wal-Mart, long known for emphasizing low prices, wants to be known this holiday season for superior customer service. That comes after its main rival Target, which has a better image in that regard, stressed a focus on offering deals.
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The world's largest retailer plans to deploy "holiday helpers" stationed at the checkouts, who can direct customers to registers with shorter lines or even run back to the aisles to pick up an item a customer forgot.
The ways in which Target and Wal-Mart are each trying to be more like the other underscore how traditional retailers have to raise their game in every aspect as shoppers who could easily shop online instead become more demanding about price, selection and service. Now, they have to be good at everything.
Wal-Mart has been working to improve service in its stores, but it's especially critical for the holiday season. It's adding additional staff to handle the pickup of online orders at the stores, and for the first time, it's designating a manager for that area for the holiday season. It also is dramatically adding more items that will be available for pickup. During the holiday season, Wal-Mart sees five times as many same-day pickup orders compared to a normal week. The goal: To make sure shoppers have an easy experience when they come to collect their orders.
The Bentonville, Arkansas-based retailer also plans to have 150,000 product demonstrations across its more than 4,600 U.S. stores, in departments from toys to food. That's up from last year. And Santas who used to remain stationary in one area of the store will roam around for more customer interaction. It expects about 23,000 appearances across its stores throughout the season.
"We want to serve the customer as they want to be served," Wal-Mart's Chief Operating Officer Judith McKenna, said at a store in Teterboro, New Jersey, on Wednesday.
Target, meanwhile, said Tuesday that about 60 percent of its marketing message this holiday season will be about value, up about 20 percent from last year. The Minneapolis-based retailer is repeating some of last year's promotions but also adding new ones aimed at getting shoppers to more areas of the store.
Heading into the holiday shopping season, Wal-Mart has the momentum.
The company raised its profit outlook in August after reporting its eighth consecutive quarterly increase in a key revenue measure. The company has been benefiting from changes like cleaning up its stores and being sharper on prices. Wal-Mart's move to raise wages and increase training for hourly workers has also helped improve service.
Target, though, had cut its profit forecast as customer traffic fell for the first time in a year and a half during the second quarter. Its key revenue measure also fell, reversing seven straight quarters of gains. It blamed several factors, such as focusing too much on marketing its stylish merchandise and not enough on bringing in customers looking for deals on basics. Both retailers are slated to report third-quarter results next month.
"Wal-Mart has been benefiting from better service, and for this holiday season it should be a boon," said Ken Perkins, president of research firm Retail Metrics LLC. "I expect Wal-Mart will outpace Target. Target has a big price hurdle."
Target's move to emphasize value actually comes as Wal-Mart itself has made prices a renewed focus.
Steve Bratspies, chief merchandising officer for Wal-Mart's U.S. stores, said that just like last year, the company will focus on rollbacks that last 90 days, pulling away from shorter-term promotions. A Roku 32-inch HDTV TV that was priced at $125 last year during a Black Friday sale will have the same price all season long this year.
Target knows it's facing a challenge.
"Value is the No. 1 determiner of where a guest will shop," said Rick Gomez, Target's senior vice president of marketing.
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