Sometimes It’s Just Too Easy

So readers of this blog know I am no fan of Wal-Mart.  The company has yielded no benefits to its investors, employees or major suppliers for almost a dedace (see equity chart here.)  Management loves being Locked-in to the outdated Success Formula, even though it does not produce satisfactory growth.

So, given that the last 4 years Wal-Mart has failed to meet expectations for its Christmas season sales you would think it was about time they came up with a new approach, wouldn’t you?  And what did they do?  According to USAToday (see article here) the company decided to whack prices down on 15,000 additional items.  Let’s see, last year they cut prices on 6,000 items and revenue did not meet expectation.  So this year the obvious this is to do………….. more of the same, of course.  What didn’t work will surely work if the company simply does more of it – right?????????  Does this in any way remind you of doctors that believed in blood-letting?

Wal-Mart is so stuck in the Swamp it can’t even think of doing anything new.  More of the same is not a strategy.  When the tactics become too easy to predict the company becomes too easy for competitors to attack (and make my blog writing too easy.) More of the same is a death sentence when the growth slows.  With lower prices Wal-Mart’s revenues and profits will suffer more, not improve.  And it’s unlikely this will even benefit consumers very much, since most of them have already said they prefer to shop at Target, Kohl’s, JC Penney and other retailers with better selection and better ambiance.

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