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Walmart & CRM, good combo?

Walmart Inc. is an American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. Walmart is the world's largest company by revenue – approximately US $480 billion according to Fortune Global 500 list in 2016 – as well as the largest private employer in the world with 2.3 million employees (Walmart, Wikipedia.com, 2018). In this blog I will walk you through Walmart’s Customer Relationship Management, which may be Walmart’s secret to its success. 

According to Rob Stokes, CRM, or Customer Relationship Management, is a customer-focused approach to business based on fostering long-term, meaningful relationships. CRM is not about immediate profit. It’s about the lifetime value of a customer – the purchases they will make in future, the positive word of mouth they will generate on your behalf and the loyalty they will show your brand. Effective CRM enables businesses to collaborate with customers to inform overall business strategies, drive business processes, support brand development and maximise ROI (Return On Investment).

Walmart’s mission statement is “We save people money, so that they can live better.”, because they are convinced that if we work together, we’ll lower the costs of living for everyone. They believe that we can give the world an opportunity to what it is like to save and have a better live (N.Shetty, 2011). 

One of the CRM policies Walmart has incorporated into their business was the “Greeting”. The Wal-Mart greeting was the original method used by the giant retailer to show customers that they are appreciated. A greeter at the door thanks customers for coming in, assists with a shopping cart, and provides a "goodbye thank you" upon departing the store. The friendly senior citizen dressed in the blue vest conveys warmth and personality to every guest entering or exiting a Wal-Mart store (N.Shetty, 2011).

So why don't others adopt this simple marketing tactic? Some do. Meijer retail stores also use greeters; many restaurants, hotels and other businesses do the same. But most don't—because relationship marketing is not as simple as it seems. It takes a type of commitment different than traditional marketing. Relationship Marketing Has 4 Key Components (N.Shetty, 2011): * It has to be personalized. Personalization can come in the form of a highly targeted direct mail piece, a phone call or email. Obviously the handshake and a smile illustrated by Wal-Mart greeters also work well in personalizing the relationship. * It has to be targeted. Wal-Mart invests money in maintaining relationships with existing customers. By targeting this group, Wal-Mart establishes long-term relationships with their most loyal shoppers. Targeting customers through programs that reward loyalty can result in big returns over the life of the customer. * It has to be meaningful. Your marketing message has to connect in an emotional way to establish a lasting relationship. If the Wal-Mart greeter did not look you in the eye while saying "hello," the greeting would not have a lasting impact. * It should be interactive. Many Wal-Mart greeters learn the names of frequent shoppers. Walmart.com, a subsidiary of Wal-Mart Stores Inc., does a great job of asking for the relationship online by providing special offers to those who supply their email address. It is important to make relationship marketing interactive so you can hear feedback, determine what is working and what is not. These key components are essential in relationship marketing programs even if your target audience is not the price-conscious retail shopper that Wal-Mart attracts. Business Relationship Marketing Can Be Achieved By Following These Tactics (N.Shetty, 2011): * Develop a relationship by mixing knowledge with fun. Plan events for clients and prospects that educate while offering entertainment and social interaction. * Send out a monthly eNewsletter or eZine with useful content that connects to your clients and prospects. This tactic will show them that you care about their business and value their time by providing them information they can use. Stay away from a sales focus. Instead, provide industry and product news with some entertainment value. * Initiate an appreciation program. Send customers thank you cards or gifts after making a purchase. You can also send a thank you gift to show appreciation for their business on the account anniversary date. * Look for ways to help your clients and prospects beyond your own capabilities. Refer them to other quality vendors, share an article related to their business or put them in touch with someone who can help. This will go a long way in building a relationship. * Make phone calls. Email is easy but picking up the phone and thanking someone for using your company can go a long way. Don't forget the value of real conversations and face-to-face meetings To understand the Wal-Mart customer, you must understand almost every other facet of the retailer's business. The fact is that everything Wal-Mart does from store design to bar coding to lighting to greeters--regardless of how simple or complex--is implemented only after carefully considering the impact on the customer. Virtually nothing is done without the guarantee that it benefits the customer in some way (N.Shetty, 2011). Furthermore, the relationship with the customer evolves from the retailer's own corporate culture. The whole idea of an associate being involved in the decision-making process, sharing the good news and the bad news, and being positively reinforced for their ideas and performance, has created a tremendous company spirit and pride of workmanship on every level of management from the headquarters office to the stock room (N.Shetty, 2011). "Day in and day out," said Glass, "it's the little things that you do." And inevitably all those "little things" that Wal-Mart does for its associates, its associates do for the customer. As a result, Wal-Mart has been able to build loyalty and trust among its customers that is unparalleled among other retail giants. Currently, according to the DSN/Leo J. Shapiro study, Wal-Mart stores are within reach of 37 percent of U.S. households, and remarkably, 34 percent of the households report having shopped at Wal-Mart within the past year. In 1987, Wal-Mart stores were within reach of 28 percent of U.S. households and 22 percent reported that they had shopped Wal-Mart within the past year. In two years, Wal-Mart has increased its customer base by more than 50 percent, with an increase of only about one-third in-store coverage (N.Shetty, 2011). By contrast, during the same two year period, K mart's coverage and customer base held steady. Currently, K mart stores are within reach of 85 percent of U.S. households and 72 percent report having shopped at K mart within the past year compared with 84 percent and 69 percent, respectively, in 1987 (N.Shetty, 2011). Target stores are within reach of 40 percent of U.S. households while 32 percent report having shopped Target during the past year. Another interesting fact revealed in the DSN/Shapiro study is that not only do customers spend more time getting to Wal-Mart then they do getting to K mart and Target, but they also spend more time shopping the store. For example, survey respondents reported that it took them an average of 20.2 minutes to get from home to a Wal-Mart store and they spent an average of 41.1 minutes shopping the last time they visited a Wal-Mart store. By contrast, K mart was closest to home with an average of 15.9 minutes, but customers spent the least time shopping, reporting an average of 35.6 minutes. Respondents said that it took them 18.2 minutes to get to a Target store, and they spent an average of 39.5 minutes in the store (N.Shetty, 2011). It could be argued that with Wal-Mart's rural strategy and K mart's more urban presence that people would generally have to travel longer to get to a Wal-Mart store. However, Wal-Mart draws from a greater distance as well. "We have an unbelievable number of people that travel from the major metro areas to the small communities to shop our stores there which is the exact opposite of what is historically taking place in industry," said Don Soderquist, vice chairman of Wal-Mart. "Our strategy is to go into smaller markets first before we hit major metro areas because you've got a smaller population base to convince over. So you begin to get the acceptance in smaller markets and the word begins to travel around and people begin to travel further and further to get to your stores."

I believe that when the competition is increasing, the customer is getting more confused about brands and products and because of that, tracking of consumer behavior is very difficult. Near about all the brands keep on trying to induce more customers and build long-term relationship with them. Customer relationship management should be effective to convey your message effectively.

I hope that this was an inside full blog for you and that you have a better understanding of the importance of CRM and a good CRM policy for your company!

Kind regards,

Martijn Brevé

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Apple Inc., the American Tech Giant

Apple Inc. is an American multinational technology company headquartered in Cupertino, California, that designs, develops, and sells consumer electronics, computer software and online services. The company was founded by Steve Jobs, Steve Wozniak and  Ronald Wayne in 1976. In this blog post, we will talk about Apple’s market research and their marketing strategy. 

According to Rob Stokes, market research unpacks how to use the Internet to understand audiences and campaigns since the Internet was originally developed as an academic tool for sharing research. 

As part of the ongoing Apple-Samsung trial, there has been a furious flurry of court filings wherein both Apple and Samsung are looking to have all sorts of confidential data and trial exhibits sealed and safely stowed away from the prying eyes of the public. As it relates to Apple, the data in question pertains to all types of proprietary information, from iOS source code to sensitive financial data encapsulating items such as product-specific revenues, profit margins, and manufacturing capacity. According to Jack Joswiag, VIP of Apple’s Product Marketing, Apple surveys iPhone buyers on a monthly basis.The surveys reveal, country-by-country, what is driving Apple’s customers to buy Apple's iPhone products versus other products such as the Android products that Samsung sells, what features they most use, Apple’s customers' demographics and their level of satisfaction with different aspects of iPhone. And equally as important as the data, Joswiak explains, is the conclusions Apple deduces from said data. One chart lists responses from customers in seven different countries, asking them why they bought an iPhone after considering an Android device. “Trust Apple Brand” emerged as the first or second most popular reason in most regions, including in the U.S and China where 54% of respondents cited it as a factor.Some 67% of Chinese respondents said they bought the iPhone because they liked the physical appearance and design, the highest percentage across the group, which also included Japan, the U.K., France, Germany and South Korea. Least important, almost universally, was the ability to easily transfer music and other media across multiple devices. “Greater availability of apps I am interested in” was a significant factor in South Korea, where 47% cited it as a reason (Y. Heisler, 2012). 

Lastly, Apple says that it's not seeking to seal market research data conducted on its behalf that surveys customers outside of Apple's user base. 

Rob Stokes defines the marketing strategy’s purpose as a way to address a business or brand challenge or objective that has been revealed. An effective strategy involves making a series of well-informed decisions about how the brand, product or service should be promoted; the brand that attempts to be all things to all people risks becoming unfocused or losing the clarity of its value proposition.

Apple primarily focusses on three major segments, one is the music lovers who are targeted by the Apple iPod and Itunes. Another target is the professionals or even teenagers who are targeted for Apple iPhone, Tablets, Macbook and other such gadgets which can be used by anyone, irrespective of age. The third is the crowd which can use their other products and services like Apple TV and Apple Iwatch. They also use iBooks, Apple pay etc (H. Bhasin, 2018).

Apple being the world’s number 1 brand has the topmost mind positioning and there is no doubt that when someone talks about smartphones or laptop or tablets, Apple is the first brand that comes to mind maximum number of times (H. Bhasin, 2018).

Apple’s mission is to design the best personal computers in the world, the Mac, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store and is defining the future of mobile media and computing devices with iPad. Their vision is that they are on the face of the earth to make great products and that’s not changing. They are constantly focusing on innovating. They believe in the simple, not the complex. They believe that they need to own and control the primary technologies behind the products that they make, and participate only in markets where they can make a significant contribution (H. Bhasin, 2018).

Apple has several competitive advantages over its competitors. They have superior technology products – Macbook and Iwatch are clearly leaders in their market space because of the OS and the technology used. Their brand equity, Apple has repeatedly taken the top spot for its brand equity and has a cult following since ages. Their revenue over time – Apple has deep pockets due to its high margins. R&D, a major competitive advantage of Apple is the amount it spends on R&D keeping its eyes on the future rather than on the present (H. Bhasin, 2018).

If we were to make a BCG Matrix of Apple, the Cash cows would be the products which are existing since ages and which cannot be challenged in the current market conditions and have a majority market share when the global data is referred, these are Macintosh, iPhone, Iwatch (50% market share in 2015) and Itunes (a solid support service to all Apple products). The stars would be Ipad and iBooks, where there is a lot of competition and Apple has to invest a lot to keep these businesses on top.The question mark would be Apple TV which has a low market share in an industry which is showing great potential and might grow at a rapid pace in the future.The dog would be the iPod because although it has a high market share, the industry itself is rapidly degrowing because Smartphones have replaced iPods (H. Bhasin, 2018). 

Apple’s distribution is remarkably one of the best out there. They have a very smart retailing setup. It has around 450 stores in the US. These retail outlets are designed such that they are more focused on helping the customer and making him comfortable with using Apple rather than selling the product and stuffing the product down customers throat. Apple has also introduced the Apple Genius Bar, which is a walk-in service centre and can help any customer in problems they are facing on MacBook or iPhone or Ipad. Overall, the company owned Retail and Service outlets are great. Along with company-owned stores, Apple has set trade partners like Ingram Micro and Redington which are responsible for the sales and distribution of the brands. These trade partners will buy in bulk from the brand and then distribute the product in the market. Thus, besides its own retail stores, Apple is found present in other modern and premium retail stores. These stores are covered by its retail partners.The Online E-commerce presence of Apple is fantastic. Most E-commerce portals promote the brand themselves because they know that the brand is in huge demand. Besides this, there is very less price penetration in Apple, and hence the channel partners and E-commerce portals are happy too as they don’t have to fight on price.  from the homepage itself. The combination of retail, distribution and E-commerce gives a complete market reach to Apple (H. Bhasin, 2018).

Apple has been one of the biggest companies due to them having the highest brand equity in the world as of 2016 and it is the topmost ranked brand in the world. The brand worth of Apple is 118.9 billion dollars. The brand has done a lot to reach this brand equity, but a major contributing factor was its ability to give hit products back to back and to reach across the globe with these excellent products. The combination of both of the excellent marketing communications of the brand help Apple reach the highest brand equity possible (H. Bhasin, 2018). 

Like any other company, Apple witnesses strong competition from companies such as Samsung. Although on a company level there is very less competition for Apple, on product levels, there is repetitive competition for each of its individual products. Ipad faces competition from Samsung tablets, iPhone faces major competition from Android-based phones, Macbook is facing stiff competition from Dell which also has superior products. The unique services offered by Apple such as Itunes also face competition from other online music players which are cropping up every day, like Spotify. Ibooks faces strong competition from Amazon and even Apple TV faces competition from Fire TV of Amazon. Samsung gear and other smartwatches are rising competitors to Iwatch although Iwatch still holds a majority market share (H. Bhasin, 2018)

To conclude Apple’s marketing strategy, I would like the address their promotions. Apple is one of the most elegant advertisers as can be seen from any of its print ads in newspapers. You will commonly find Apple ads to be clear and crisp in their message. Their background will be white and there will be a splash of colours in the print ad introducing the product or differentiating the product.And that is one major strength of the brand. Apple has so many differentiation points that it can have a slew of ads, all targeted towards differentiating the products that it is offering. Not only the print ads, even the video ads do the same. They tell you one point which highlights the product features.Here is a simple image made by Apple to differentiate between PC and Macintosh (H. Bhasin, 2018) 

Overall, the advertising and promotions of Apple are used tenfold when there is a new product launch. The hype created is so much that you just can’t ignore it. And this hype is continued until the product becomes a success. As the number of products with Apple is less, it is no doubt that it wants each one of its product to be a hit (H. Bhasin, 2018).

I hope you enjoyed reading the blog and have a more in-depth view on Apple’ as much as I did making it for you guys!s market research and their marketing strategy.

Martijn Brevé