The summer retail holiday event of the season – “Back-to-School” – is about to begin. It is that time of the year when parents fret, teachers need Kleenex, and retailers hope like hell for good profit margins.
And one retailer that takes the season about as seriously as anyone is Walmart.
Last week Walmart revealed that it will offer this year’s assortment of school supplies at last year’s prices. This price promise extends across classroom supplies and backpacks, with 14 of the most popular items available for just under $12.94.
Why 14? Who the hell knows? That’s a question for a different day and one more for Walmart’s PR department than anyone else.
It should not, in any way, be a distraction from the main point here – namely, that Walmart is doing what it does best, asserting its authority on price.
Walmart is returning to its core strategy of unbeatable pricing, a strategy that has served it well for decades, and one that should scare the living crap out of any retail merchant trying to compete with Walmart on this upcoming Back-to-School season.
The discount giant is effectively telling the market, “You can’t touch us on price,” (my quotes) and, in so doing, has likely sent every school supplies buyer that had built inflation cushion into their financial models scrambling to adjust his or her financial projections and/or marketing strategies in response to an “ASAP” mandate from his or her now quite tightly puckered bosses.
From a consumer facing standpoint, the move reaffirms Walmart’s position as the consistent go-to destination for cost-conscious shoppers, especially when it comes to big stock-up trips like back-to-school shopping. It is a move that likely will go a long way in reinforcing consumer confidence in Walmart’s well-known commitment to affordability.
It is also important to note that Walmart’s announcement comes at a time when inflation appears to be moderating and traffic to stores appears to be increasing.
For example, Adobe released a report last week stating that online prices have seen their most significant drop in any month since May 2020; the Consumer Price Index overall registered its lowest increase in June since March of 2021; and U.S. retail sales in June, according to the Commerce Department, also rose 1% after a decline in May.
All of which, when taken together, means that Walmart has its strategic groove back. It is clearly playing to win this season, and, with macroeconomic and industry-wide traffic tailwinds at its back, who is going to stop them?
Save Money. Live Better.
That’s Walmart’s brand promise, and when Walmart is doing things right, every move it makes plays right into this ethos.
So, retailers, you had better take cover. The first shot of the Back-to-School selling season has clearly been fired, and it looks to be one awfully big cannonball aimed in the exact right direction.
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