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.
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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