Oct 22, 2009 8:08 pm US/Eastern
Wal-Mart Holiday Promise: 'We Won't Be Undersold!'
World's Largest Retailer Draws Line In Sand, Preparing For Deepest Holiday Discounts Ever
Reporting
Jay Dow
SADDLE BROOK, N.J. (CBS) ―
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With the holiday shopping season approaching, Wal-Mart is hoping to lure buyers in by offering deeper discounts than ever.
AP
With the holiday shopping season upon us, Wal-Mart is hoping to lure buyers in by offering deeper discounts than ever.
The mega-retailer appears to be sending a message for the holidays, saying it will not be undersold.
Rising household expenses, shrinking job numbers, and ever-increasing prices are a toxic mix in a tough economy. Now executives at Wal-Mart – the world's largest retailer – say they have the answer to save this holiday season: giving customers, including those at the Saddle Brook, New Jersey location, the absolute best price possible.
"I think it's great – people need that right now to boost their morale," Lodi resident Anthony Scalia said. "As prices go down, they can spend a little bit more money, maybe."
During this week's annual analysts meeting, Wal-Mart executives drew a line in the sand with the retailer's competitors.
"We will not be beaten in price this holiday season, and we hope that will draw comparable store sales," Wal-Mart Stores Vice Chairman Eduardo Castro-Wright said.
"Everybody's got something they're struggling with economically – they are people losing their jobs, or about to lose their jobs, or afraid of something," Clifton resident Erika Bush said. "So you just want to be smart, and this is the way to go."
The plan is to put into hyper-drive the strategy that has already earned the company billions of dollars, while putting the squeeze on competitors – large and small – with sometimes devastating results.
"What they have done is set a lower bar on pricing by category," retail expert Jeff Edelman said. "For example, if you look at the toy industry today, you've got very few independent toy retailers out there."
"When you cut prices, you boost volume, so you end up making more even though the margin is less," company spokesman John Simley said.
Wal-Mart may be dropping its prices this holiday season, but for some people, the year has been so rough that it won't even matter.
"I can' spend nothing, I can't buy too much," Hackensack resident Madeleyne Lucero said. "I mean, only just one present for my son."
Underscoring the need to cut prices, a retail industry study estimates that Americans will reduce their spending by more than 3 percent this year, with most people's buying choices driven by discounts.
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