The holiday season is coming up and Wal-Mart is dropping prices on key items including televisions, toys and turkeys. The company has been churning out press releases in recent weeks to announce the latest rollback designed to help consumers "Save money. Live Better."
Richard Hastings, a consumer strategist for Global Hunter Securities LLC, told Bloomberg, "This is the proven and effective method they deploy using major categories to drive loyalty and to take marginal sales away from the competition."
Some wonder if Wal-Mart's price-cutting will be the final nail in the coffin (the chain recently started selling those) of struggling retailers. Others have suggested that Wal-Mart is following its traditional pattern and that this year's rollbacks are pretty much in line with the past but that the company's public relations machine has made it appear to be something bigger.
The chain's stores in the U.S. are selling turkeys for 40 cents a pound, about a third of the average price of birds in 2008, according to the American Farm Bureau Federation.
"We're proving that we're committed to helping
moms afford the holidays in these tough economic times," Jack Sinclair,
executive vice president, groceries, Walmart, said in a press release.
Wal-Mart is selling a Sharp 46-inch television, which
normally retails for $1,158, for $698. The company also announced this
week that it was lowering prices on 100 additional toys.
"We'll offer aggressive pricing on toys this season to ensure moms can afford the gifts that help create a holiday their kids will remember," said Laura Phillips, vice president of toys for Wal-Mart, told the Arkansas Democrat-Gazette.
Discussion Questions: Is Wal-Mart being more aggressive with its pricing this year versus past holiday seasons or is its media machine creating an impression of more dramatic rollbacks than actually exist? As a competitor, how would you deal with the moves Wal-Mart is making?