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Lessons For Hotels From Walmart

Retail Giant Provides Blueprint For Consumer Recognition, Success

Tuesday, May 03, 2016
Mr. Larry Mogelonsky - CHA
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Years ago, and well before my hotelier days, I traveled to Bentonville, AR selling ergonomic furniture, mouse pads and the like. The Walmart offices were huge then and I can only imagine how much they have grown since. Today, Walmart is the world’s largest company by revenue ($288 billion) and employees (2.2 million), rivaling the GDP of many nations, including some that are traditionally defined as first-world.

What’s most interesting to me is that hoteliers, by and large, have never really looked to this retail titan to see what they can glean. Perhaps it’s a stigma whereby Walmart is perceived as ‘beneath us’ or that a discount retailer is totally unrelated to our heads-in-beds raison d’être. In any event, here are a few initiatives that Walmart does exceptionally well that should be on our radar.

1. It advertises. Walmart did not grow on its own. It is among the world’s heaviest TV ad buyers. Its recognition had been bought through countless GRPs (gross rating points) of continual media buying. Many hoteliers these days, I’m afraid, do not consider advertising – broadcast or digital – as a major component of their brand support program.

2. It has not diluted the brand. Just two names – Walmart and Sam’s Club – seem to work for 11,500-plus outlets. It does not create ‘lifestyle’ property categories or other sub-brands on a marketing whim. A chain with 18-20 brands is going to have a challenge with any sort of clear recognition or differentiation.

3. A strong environmental commitment. Walmart has universally adapted LED lighting as just one of the green-conscious approaches it has taken. Apart from the lucrative financial ROIs, it is leading the way for other companies.

4. One, unswerving consumer strategy. “The lowest price is the law.” Remember this statement? It is hammered in through its advertising and followed up in-store. By having a single-minded focus, both the company and the consumer are on the same wavelength. Most hotel plans that I’ve read have trouble distilling the strategy down to a half-dozen unique or semi-unique approaches.

5. The masters of data. Walmart knows its POS data in real-time. It manages inventory down to the store level and can refill stores to meet on-shelf requirements effectively. Do you know who exactly is staying with you tonight? Last night? Tomorrow night? How about 365 days from now?

6. It has greeters. Comedians like to make fun of the Walmart greeter program. But, they serve a valuable purpose in reassuring the customer and helping out at the store entry. It’s part of the brand guarantee to service the consumer as best possible. Ever consider having a greeter standing out in the open in the hotel lobby instead of sequestered behind the physical barrier that is the front desk?

7. It tests and plans. New items just don't appear across all stores; they are tested in store panels to ensure their success. Shelves are planned with perfect store-to-store consistency. With hotels, there is much more variation across each chain, and while the parallel might be considered a bit of a stretch, standards must nevertheless be adhered to, or at least suitably adapted to meet regional quirks and demands.

These are just a few that I have come up with. Can you add any more relevant practices that have hospitality applicability?

Credit
Larry Mogelonsky CHA    Mr. Larry Mogelonsky - CHA
Chairman, LMA Communications Inc. | Principal, Hotel Mogel Consulting
Owners, Principals, or Partners
LMA Communications Inc.

Bio: One of the world’s most published writer in hospitality, Larry Mogelonsky is the principal of Hotel Mogel Consulting Limited, a Toronto-based consulting practice. His experience encompasses hotel properties around the world, both branded and independent, and ranging from luxury and boutique to select-service. Larry is also on several boards for companies focused on hotel technology. His work includes four books “Are You an Ostrich or a Llama?” (2012), “Llamas Rule” (2013), ...
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