Pulling Punches

CEO Lee Scott went on the record to fight Wal-Mart's bad rep. But his PR effort hit the mat.

Lee Scott

President and CEO of Wal-Mart
January 2005
PR blitz

On January 13, millions of Americans opened their morning papers to find a full-page ad declaring, "Wal-Mart is working for everyone," and signed by Lee Scott, the company's CEO. The same day, Scott appeared on Good Morning America, Fox News, and CNBC — trifecta! — staying determinedly on message: Contrary to what its detractors claim, Wal-Mart treats workers well and is good for communities.

For most of its 43 years, Wal-Mart has been notoriously tight-lipped. But facing criticism of its labor practices, a pending gender-discrimination class-action suit, and general angst over offshoring of manufacturing, the world's largest retailer decided to hit back. It launched a media blitz with all the subtlety of a Don King press conference.

The spinning was enough to induce vertigo. Scott called the company's carefully orchestrated PR campaign "an outreach." This particular outreach wasn't about defending Wal-Mart, he said, just setting the record straight. With facts. "Real facts about Wal-Mart as a place to work," the ad read.

The whirlwind tour was meant to humanize the low-cost leviathan so often depicted as self-serving and ruthlessly pragmatic. But Scott didn't pull it off. On-screen he was reserved and careful, like someone well coached by the fellas from legal. His gaze was flat, his smile thin and forced. His low-key manner in the face of critical allegations came off as dispassionate and, well, kinda mean.

Scott kept promising to tell the real story and provide the real facts. But from one interview to the next, it became clear that the retailer only wanted to tell part of the story and share certain facts. When asked on Good Morning America how much Wal-Mart imports from China, Scott said he didn't know. Coming from a company known for tracking practically everything, the dodge sounded absurd.

So, fine: Let's check out the real facts. Wal-Mart says it plans to create 100,000 new jobs in the United States this year. But where will these jobs come from? Most likely from new stores — which will just cannibalize other retailers and put their employees out of jobs. See how Wal-Mart works for everyone?

Wal-Mart's ads also trumpet its workers' average pay: nearly twice the federal minimum! Specifically, it's $9.68 an hour. Given Wal-Mart's 34-hour workweek, that, less health premiums and federal taxes, comes out to about $1,200 per month. Before bragging about the pay, Scott might try living on it.

Wal-Mart was right to open its kimono. But ultimately, the campaign failed to give consumers and critics reason to feel differently about the company. Instead of quelling controversy, it fanned the flames. It reeked of damage control and proved only that Wal-Mart is as bad at PR as it is good at selling diapers cheap. Scott would have done better spending all that ad money on his employees. That's how you work for everyone.

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