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Walmart Savings Catcher and the Future of Everyday Low Price

by Robert Hetu  |  August 26, 2014  |  6 Comments

I start out admitting that I am cynical about a process where I upload my receipt and rely on the retailer to do detailed analysis of competitive pricing to determine if I am entitled to a refund. However I view it as part of my research to try just about everything at least once. After Walmart announced the savings catcher app for smart phones I downloaded it straightaway to see my savings mount up. Well so far not so much. Walmart has repeatedly let me know “No lower price found!” via email communication. Overall, from receipts that totaled $340, the savings catcher found 52 cents. That is 0.15% of what I spent over the last 6 trips to Walmart. savings catcher

Of course a major driver of this result is found in the details.  A view of the Walmart Savings Catcher FAQ shows numerous exceptions. While this is clearly spelled out it started me wondering about messaging. On the one hand this could serve to reinforce the idea that it is the everyday low price leader. On the other hand logic tells me that I could have obtained better prices on some of these purchases at other stores by simply taking advantage of sales that were excluded from consideration by Walmart. Walmart is one of the few retailers that have been successful using an everyday low price strategy. Although there have been some cracks in the armor, for example expanded “rollbacks”, could competitive pricing pressures fueled by technology enabled consumers cause more pressure? Taking a step into price matching, first with local ad match and now with the savings app, may change the meaning of everyday low price.

Consumers are increasingly sensitive to pricing, including multichannel consistency and competitive fairness. In fact, trust is increasingly a driver of loyalty. Having built its business model on being the low price leader Walmart will be challenged to ensure that they are meeting this customer expectation. The elephant in the room is of course the extensive list of exceptions Walmart has applied to the process. Can a retailer really retain the title of low price leader when the exceptions themselves speak against this? Is it really not possible to compare a Walmart branded product, for example a can of green beans, to one carried by local competitors? Consumers make these comparisons every day. Should Walmart match promotions such as BOGO’s and buying multiples such as buy more and save more? Absolutely if it wants to keep its pricing positioning.

The most important lesson on pricing in the digital environment is that retailers cannot delude themselves any longer. The customer has as much information at their fingertips as the retailer has and if they cannot trust your brand image you cannot build loyalty.  As for me, I am waiting to see if I can catch any savings on the $30 of school supplies I purchased last night.

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Category: pricing-policy  retail-trends  

Tags: competition  consumers  coupons  digital  price-transparency  pricing  retail  revenue  satisfaction  stores  trends  walmart  

Robert Hetu
VP, Analyst Retail
7 years at Gartner
29 years IT Industry

Bob Hetu is a Research Director with the Gartner Retail Industry Services team. His responsibilities involve tracking the technology markets and trends impacting the broad-based retail merchandising and planning areas. Mr. Hetu is an expert in the areas of brand, vendor and assortment management, merchandise planning, allocation, and replenishment. Read Full Bio

Thoughts on Walmart Savings Catcher and the Future of Everyday Low Price

  1. […] I start out admitting that I am cynical about a process where I upload my receipt and rely on the retailer to do detailed analysis of competitive pricing to determine if I am entitled to a refund.  […]

  2. […] Walmart Savings Catcher and the Future of Everyday Low Price. […]

  3. Kelsie Welch says:

    Hi Bob- Great post.
    I had a similar experience in signing up for Walmart’s Savings Catcher. I saved fifty cents on a large receipt…so they proved they do pretty much have the lowest prices, except for the one or two items which resulted in the ‘savings caught’. That said entering and keeping track of the receipts can be a bit cumbersome and it was three days to receive the notification I had saved the fifty cents.
    This could be Walmart’s version of an ‘loyalty program’ (sort of) which they have steered away from in an effort to prove they are the low price leader and everyone who shops with Walmart deserves the lowest prices- not just members.
    It seems Savings Catcher may be means to avoid rolling out a complete loyalty initiative but still collecting consumer info and email addresses. It will be interesting to see how long the program lasts and if consumers are willing to continually scan and enter their receipts (and providing info) for what amounts to very small savings and more of an FYI “we’re still the low price leader.”

  4. Robert Hetu says:

    Thanks Kelsie – good points noted here concerning loyalty.

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