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Wal-Mart Tries to Buff Its Image

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August 18, 2003
Wal-Mart is the nation's largest employer and the world's biggest retailer. It is far and away the biggest customer for most of its suppliers. Yet it has until recently clung to an aw-shucks, downhome self-image, espousing "heartland values" and calling its mostly-minimum-wage employees "associates."

That's the Wal-Mart the folks at its Bentonville, Arkansas headquarters see. But after much prodding by board members, the huge chain has hired image consultants to find out what everyone else sees when they look at Wal-Mart. What the image doctors are reporting isn't what Wal-Mart has been seeing in its mirror all these years.

The research by Fleishman-Hillard finds that employees, particularly women, often see working at Wal-Mart as a dead-end job. Suppliers see the company as constantly pushing for lower prices that sometimes make it hard to stay in business and pay workers a living wage. Small towns see it as a rapacious giant that kills off local stores and paves over the countryside.

Other than that, no problem.

The image research coincides with a federal lawsuit alleging discrimination against women employees, heightened activity by union organizers and growing community resistance to new stores in rural, suburban and metropolitan areas.

It is the women employees' suit that holds the most potential to seriously deface Wal-Mart's reputation.

Last May, seven women filed for class-action status in their lawsuit. The federal court filing, which alleges systematic sex discrimination in pay, promotion, and training, could potentially balloon the case to include more than 1.5 million current and former female workers employed at Wal-Mart and Sam's Club since December 26, 1998.

That would make it the largest employment discrimination case in history. A hearing in the case is scheduled for next month.

The National Organization of Women (NOW) has been scathing in its criticism of Wal-Mart, which it regularly refers to as "Merchant of Shame" and notes that Wal-Mart is "the most sued retailer in the country -— facing charges ranging from pay discrimination to violation of child labor laws to discrimination on the basis of sexual orientation."

Hoping to revive its deteriorating image, Wal-Mart, always tight with a dime, has not only spent big bucks on the image research but is now rolling out an elaborate and costly series of television ads showing smiling women employees achieving their career goals in an atmosphere of diversity and innovation.

Predictably, the ads are now drawing fire. In Phoenix, Arizona Republic columnist Jon Talton castigated Wal-Mart for putting image ahead of substance.

"Relatively few (of your associates) work 40-hour weeks, and a union cashier at Safeway or Albertson's can make twice as much as one of your checkers. Nor is it easy for someone making seven bucks an hour to afford your 'pay-for-it-yourself' benefits," Talton wrote in his Aug. 17 column.

Talton also lashed Wal-Mart for "clear-cutting the retail landscape." Founder Sam Walton saw Wal-Mart as bringing consumer choice to small towns but Talton said the chain is now so dominant it is stifling choice.

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