Wal-Mart, UPS & the power of ubiquity

Allow me to caveat this entire notion with the fact that I’ve never, in my adult life, set foot inside of a Wal-Mart, for no reason in particular. Certainly, I’m familiar with the common misgivings held by communities and local retailers, fearful of Wal-Mart’s magnetic pull. Additionally, I’m well-aware of the corporation’s union-busting and anti-organizing efforts. In both cases, my heart lies sympathetically with the little guy.

It is also well-worth pointing out the fact that I lack the hubris to think that Wal-Mart, efficient money-making machine that it is, either needs this idea (or has not already explored it).

The ubiquity, though of retailers like Wal-Mart - or for that matter, Starbucks, McDonalds, or a handful of other omnipresent chains - demands a supply chain of almost inconceivable breadth and efficiency - a supply chain that several retailers have been eager to resell to smaller companies eager to outsource. Inherent to a company like Wal-Mart is a steady stream of products rolling into and out of their retail stores and through a large network of distribution hubs on a near-constant basis.

This channel has allowed Wal-Mart, with a number of other retailers following suit, to build an ingenious program offering free shipping to any Wal-Mart store for any item purchased from Wal-Mart.com via a program they call Site-to-Store. In addition to driving more traffic to their website and reducing the need for unnecessary inventory in individual stores, this has the added benefit of bringing consumers into their local stores to pick up their shipment (and while they’re at it, buying toothpaste, a swimsuit and a beach towel) - almost certainly the driving incentive here for the company.

So why not extend this idea?

Why not allow consumers to ship anything to anyone from one Wal-Mart to another, for free?

This brings two sets of consumers into a Wal-Mart, for a single transaction. It increases the likelihood that consumers will make their gift purchases at a Wal-Mart, as they can buy, wrap and ship in a single location. It piggybacks on an existing supply and distribution chain, keeping costs low while incenting customers to make additional in-store purchases. Finally, it supports (and does so strongly) the notion of ‘Save Money, Live Better’ that is at the heart of the new brand positioning.

Consider this:

There are 19 manned UPS dropoff locations within 20 miles of downtown Birmingham, Alabama (this includes UPS Stores and public UPS Shipping Offices). There are also 19 Wal-Marts in the same radius.

In Wichita, Kansas, there are 7 manned UPS locations, and 8 Wal-Marts within 20 miles of downtown.

With this sort of ubiquity, and little loss in convenience - admittedly, these examples are geographically biased to make a point - does the offer of free shipping not benefit both the company and the consumer?

Just a thought.

Hay (and making it)

I’ve been chewing on the idea of commenting on this piece by Al Ries for a few days now, hesitant, in part because:

1. I’m no expert on branding. Certainly, I’ve nowhere near the credentials of Mr. Ries.
2. I’m no futurist.

In the aforementioned post, entitled Don’t Tinker with your Brand, Mr. Ries argues against toying with pricing (another area in which I can claim no leadership position) and other elements of your brand during this economic downturn, and suggests that ‘riding it out’ is the wisest course of action:

Economic markets rise and fall like the ocean. Strong brands will survive no matter what the tide. The key to long-term success is riding the waves up and down using your brand as a steady rudder. You should not attempt to sail against the current. And you should not over steer the ship.

and more:

Brands that stay strong and survive no matter what the weather are those that stay consistent. Your brand has meaning and strength only if it owns something in the mind. And the more you adjust and tinker with that meaning, the weaker your brand becomes.

Before diving deeper, let me reiterate that these scarcely comprise the bulk of Mr. Ries argument, and should not be taken out of context. His article, worth your time, makes a larger (and I think correct) point. The element of his argument for raw consistency, though, that gnaws at me is that it is constructed on the following assumptions:

1. Brands, themselves, continue to hold the upper hand in their relationships with consumers.
2. The brands of which he speaks are already strong and thriving (and therefore poised to do so when the economy regains strength)
3. That the economy, when it returns to strength (an eventual inevitability) will closely resemble the economy that existed prior to the collapse.

Of the three assumptions, it is the third that gives me the greatest pause. This notion is rooted in the idea that consumer credit markets will re-open to the dangerous levels of excess of recent years; that home prices (the fuel for home equity loans) will rebound in a manner that correlates directly with trade and inflation (improbable, we’re told, for the time being); and that the competitive landscape will remain largely unchanged through the process (again, unlikely, unless the corporate fatalities are far fewer than many economists project). Still, given my aforementioned inability to tea-read, I’ll stick to my own areas of interest.

The recession (it seems we’re now comfortable with the phrase) presents enormous opportunities for companies to reshape the way in which they are doing business with both consumers and one another, with the potential for significant positive impact on their brands, does it not?

Will there ever be a more opportune time for companies to move customer service online in a manner that gives the consumer better access to the information they need, and at a lower cost?

Will there ever be a better time to train both corporate and retail employees on the products and services sold by the brand, and the core mission that the brand espouses? With greater access than ever, one assumes, to a skilled and motivated workforce, the opportunity to imbue workers with this knowledge seems more in reach than anytime in memory.

Will there ever be a time better-suited to examining (and re-examining) the mediums through which the brand flows? With the inevitable eventual drop in media costs, and a need to optimize spends (the old adage of making every dollar count as two is more prescient than ever, no?), brands are presented with a great opportunity to rethink existing assumptions about ‘what sticks’.

The opportunities for refinement are numerous, with significant short and long-term implications for brands that desire to be well-poised for the upswing. That these refinements are rooted in a need to improve efficiency in the short-term should, I think, be seen not as tinkering, but rather as the sort of incremental change that fuels survival.