Wal-Mart spiffs up in bid to broaden appeal

Yakima is one of the 322 stores that underwent full remodels. In the 1,800 additional stores receiving a more modest facelift, O’Brien said the company is making similar changes in any or all of four areas: apparel, restrooms, electronics and home.

From the wood and metallic design touches to the occasional greenery, the intent is clear: Wal-Mart wants to be thought of as a pleasant place to shop, not just a massive warehouse for snapping up bargains. The question is whether the changes will be enough.

One big problem facing the company is that the remodels themselves are disturbing store operations and turning off some customers. A full remodel takes 10 to 13 weeks, while a partial upgrade can take two to four weeks.

“The end result is incredible, but the disruption during the process is also incredible,” said Kaye Young, senior vice president with consultant group Retail Forward, which provided customer feedback to Wal-Mart ahead of the remodel plans.

Young has been surprised by the noise level, temperature changes and disturbances that have included birds flying through some stores. Such unpleasantness may turn off a small percentage of shoppers permanently, she said, although most Wal-Mart shoppers stay loyal because of the low pricing.

O’Brien noted that Wal-Mart suspended remodeling efforts during the busy holiday season. She said she thinks customers have been understanding, especially once they see the results.

Young thinks the changes will help Wal-Mart, but she said the company also needs to do more than just improve the stores’ looks.

For example, she said the redesigned electronics department may lure in more people looking for big-ticket items like computers or wide-screen TVs. But those same shoppers may leave empty-handed if the company does not have knowledgeable staffers to help them pick out the right item.

Analyst Edward Weller with ThinkEquity Partners said he welcomes any upgrades that could make it easier to find things in Wal-Mart’s massive stores. Still, he thinks the company continues to fill up areas including the aisles with too much product, potentially putting off customers.

While Wal-Mart has made some effort to tailor its store offerings to meet the demands of higher-income areas, Weller thinks they could do more to differentiate its stores.

He also noted that Wal-Mart must go beyond just providing a more pleasing environment if it wants middle-income customers to purchase more items. The retailer also has to offer them more of the types of things they want to buy.

“It’s not just the remodels,” he said. “I think a lot of it is content.”

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