Marketing Project on Wal-Mart Company

Marketing challenges faced by Wal-Mart Company

For a business to succeed it must define the best ways to communicate the benefits of their products to the target market. Effective marketing strategies define the extent to which a business can succeed. The modern business environment is characterized by very stiff competition thus it is crucial for businesses to formulate marketing strategies that help in acquiring a large market share. The marketing strategies differ with the target market, size and nature of the business. The organizations that operate in different regions have to consider the various aspects that shape the preferences of the target market. Effective marketing research as well as the managerial decisions determines the success of marketing strategies employed in a business. The problem in marketing strategy is indicated by the inability of a business to meet the demands of the customers in a better way than the competing firms. Poor marketing strategies make it difficult for companies to achieve the target sales volume. The low revenue from sales may lead to failure of the business due to huge losses. It is thus important for companies to define effective marketing strategies to enhance the performance of the business.

One of the companies that may need to change its marketing strategies is Wal-Mart Company for it to restore the lost glory in the retail industry. Although the company has been listed among the most successful businesses in the world, it has experienced various challenges that may change the trend of growth in the company. The sales volumes in some countries where the company’s subsidiaries perform well are high but the situation in China is different. Considering the high retail market in China, one would expect that the company’s sales volume would be the highest among the subsidiaries. The drop in the sales volume can be attributed to poor marketing strategies employed by the company in the country. This research examines the marketing challenges faced by Wal-Mart Company in particular poor marketing strategies in China. The paper uses PESTEL analysis to explain the situation of the company and it also provides the methodology that can be used to carry out further research in the marketing area.

Company overview

Wal-Mart Company is a major player in the United State retail industry as well as other nations such as China and the United Kingdom.  The family company is ranked as one of the most successful organizations due to its large market share, especially in the United States. The company has been in operation for more than five decades an indication that its marketing strategies have been effective over the years. There are three segments of business in the company dealing with various products that the company offers. Among the businesses that the company operates include supermarkets, supercenters, discount stores, restaurants and hypermarkets. The diverse nature of the businesses has seen the company survive some of the hardest economic times in the economy over the years.

The company established itself in the United States initially but the need to expand its market share led to managerial decisions to establish new markets in other countries.  The intention to go global was also possible due to the high capital that the company had accumulated in the United States.  It also accumulated capital from the trading of shares in the stock market that it joined in 1972. Over the years the company has grown to become one of the best brands thus making it even easier to stay ahead of the competitors. It is also one of the major employers in the world, making it a major contributor to the well-being of the society. The investments of the company in other regions outside North America have had varying performance. The company’s success in establishing a subsidiary in regions such as South Korea was not realized but it has gained maximum benefits of globalization from the investments in countries such as the United Kingdom and China. However, the sales volume in China has dropped in the recent years, and this is attributed to poor marketing strategies by the company.

As one of the largest economies in the world, the country offers a large market for retail products. The high population in the country is also a factor that Walk-Mart considered while making the decision to invest in the country.  The company entered the Chinese market about 19 years ago with an aim of expanding the market share and the business was a success until recently when the performance of the subsidiary has declined. At the time when the company was establishing its market in the region, there was a high population of middle class with a relatively high disposable income and this presented a favorable market opportunity for the company.

However, the company’s inability to change with the varying needs of the Chinese market has made it harder for it to achieve success in the modern days. Out of the total revenue of the company, China’s subsidiary contributes only about 2% which a very small percentage of revenue considering the potential in the country in terms of market size. Further, the retail industry in the economy is growing at a high rate thus, one would expect a rise in income for retail companies. The company has succeeded in using the price leadership strategy over years to acquire a large market share but this is not working anymore for the Chinese market. The consumers in the country do not consider only the price in making their purchase decisions but also quality and authenticity. The company has lost most of its customers in the country to a major competitor known as Sun-Art retail group. Despite the large presence of the company in China, it has a lesser market share than the competitor. The competing firm provides the consumers with the shopping experience they prefer of outdoor markets, an aspect that Wal-Mart has not been able to achieve.  The progress that the company has made in China has been slow and uneven in the recent years thus it may consider changing the marketing strategies to suit the demand of the retail customers better.  To change the trend of low sales volume in the company, it is necessary to apply the most suitable marketing theories and in this case the PESTEL analysis can be helpful to the company.

PESTEL Analysis

The model is one of the most applicable marketing theories especially for companies that invest in more than one region. The marketing objectives are shaped by a country’s technological, economical, cultural, social and legal background. These are the aspects that businesses must consider in making decisions about the marketing strategies.  The model helps the companies in monitoring the external environment of the business thus influencing the marketing decisions. The company must carry out both qualitative and quantitative research to enhance the performance of the business.  The political factors determine the degree of government intervention in the business through various regulation policies such as foreign trade policies, tax policies, environmental regulations and labor laws. The analysis also helps in determining the suitability of the business environment in relation to the political stability. Through effective research on the political factors in the Chinese market, the company may be able to formulate effective marketing strategies considering the probability of future changes in the environment.

The economic analysis is another aspect that is helpful in making appropriate marketing strategies in companies. The analysis helps in determining the economic growth, inflation, exchange rates, and the disposable income of the population. It is important in making marketing decisions as it helps the company in identifying the best pricing strategies to use and the target populations. The macro-economic factors in the analysis are important in determining the demand trends in the population with regard to the actions by the government to increase or decrease the demand. The micro-economic factors on the other hand determine the spending pattern of the different classes of consumers.  The social-cultural factors determine the marketing strategies that a company should adopt based on the shared beliefs and attitude of the consumers. For instance, most of the Chinese consumers prefer buying retail products such as groceries in an outdoor market. The positive attitude that the consumers have towards the outdoor markets shape their buying behavior.  The social cultural factors that the researcher may analyze include the population growth, age distributions and health consciousness of the society. This is important in defining the best advertising channels and the goods to stock.

Technological analysis in the model helps in determining the best marketing channels in terms of cost and efficiency. The analysis helps companies decide the best way to communicate to the target market considering the most popular channel.  The analysis also helps in determining the method of distribution of goods thus increasing the satisfaction of the customers. The environmental analysis is very important because it shapes the attitude of the consumers towards a company. Compliance to the environmental regulations is considered as an ethical way of doing business and it influences the buying decisions of the consumers. Knowledge on the environmental factors may be helpful in defining the message that is communicated to the customers through the marketing channels.  Legal factors are also important in overcoming the marketing challenges faced by a business because they determine factors such as advertising standards.

Research design

The research will adopt the exploratory mixed method research design because the research on marketing challenges faced by foreign investors who operate in the Chinese retail industry is limited. The research design entails using both qualitative and quantitative research techniques. It is suitable as it will help the researcher identify the perceptions of the consumers towards the company’s retail products thus enhancing the decisions of management on the best marketing strategies to adopt. The quantitative research will help the researcher in identifying the perception of the consumers while the qualitative research will be useful in understanding the factors that shape these perceptions. The research design will enhance the accuracy of the data collected due to combination of both the quantitative and qualitative methods of data collection.

The research will rely on primary and secondary data sources to enhance the decision of the management on the most suitable marketing strategies. The secondary data will be obtained from academic sources such as peer reviewed marketing journals, reports, Chinese government publications and marketing books. The researcher will ensure that the secondary sources are reliable by looking at factors such as the credibility of the authors, the date of publication, and the extent to which the sources cover the topic of marketing strategies. The primary sources will include data from interview survey and questionnaires. The project will require a maximum of two weeks to collect all the information required from both the primary and secondary sources.

Data collection forms

To collect qualitative data, the researcher will use market survey through interviewing, as it is the most suitable tool to identify the perceptions of the consumers towards the company’s products. The following are sample questions suitable in the survey interviews.

How often do you shop at Wal-Mart retail outlets?

Why do you prefer shopping at Wal-Mart over other retail shops?

Do you think that Wal-Mart products meet high quality standards?

How has adverts on Wal-Mart influenced your buying decisions?

What is your opinion on the price of goods for Wal-Mart Company?

Sampling plan

It is important for the researcher to identify the materials to be used in the research, the maximum time required for the research, the manner in which the research is to be collected and the individuals to be involved in the activity. To collect data the researcher will use random sampling technique to avoid bias that may lead to inaccurate results. The following sampling plan will be useful to the researchers.


Parameters The research will aim at understanding the attitude of the consumers towards the products of the company. The most important parameters will include price, frequency of purchase and influence of adverts.
Sampling scheme The time required for the research to e complete will be two weeks so as to allow the researchers ample time to reach different regions of the country.
Sample size The sample size for the qualitative data will be 100 individuals while the quantitative data will be collected from 500 individuals.
Data storage All the data collected will be stored in soft copy form to enhance its security.
Cost estimates The cost will include the travelling, food and accommodation expenses incurred by the researchers.
Responsible individuals All the duties will be divided among the research team members according to their skills and experience.


Data analysis

The qualitative and quantitative data will be analyzed using different methods due to the nature of the techniques. While qualitative data has non-numerical responses, the quantitative data uses numerical responses thus the analysis employed in the two techniques cannot be similar. The quantitative data obtained from the questionnaires will be analyzed through the SPSS method to determine the level of correlation in the data.  The factor analysis used in the SPSS will help the researcher identify the possible causes of the marketing challenge in the company. Coding is an effective method of analyzing data collected by means of interviews. The data analysis method is not only easy to understand but it also helps the researchers identify similar trends in the data collected. This will enhance the accuracy of conclusions drawn from the data making it possible for the management to make sound marketing decisions.  Through coding, it is possible for the researchers to identify similar concerns raise by the respondents thus making it easier for the business to identify the issues that they should address in the marketing strategies.

Coding will be performed in three phases to arrive at accurate conclusions about the data. Open coding is the first step that will involve going through the responses to identify any similar trends. This will help the researcher understand the marketing concepts involved in the research. The data will then be broken down according to the different concepts to enhance its interpretation.  To ensure that the identified concepts are relevant to the area of study, the researcher moves on to the axial phase that will help the researcher identify the relationship between the identified concepts and the research problem. The last phase in coding involves using tables, pie charts, graphs and other data presentation tools to enhance the interpretation of the data.

Conclusion and recommendations

The performance of a business is greatly influenced by the marketing strategies adopted by a company. The business environment in the modern world is not constant as it changes rapidly thus there is need for the businesses to carry out market research regularly. The research is important in identifying the changing trends in the market and this enhances the effectiveness of the marketing strategies of the company.  By using the PESTEL analysis, it is possible for the company to identify the challenges and opportunities in the Chinese market. It is through this analysis that the company can be able to define the most effective method of communicating to the target market. The changes in technology identified in the technological analysis are helpful in determining the most effective communication channels. Businesses exist to make profits by meeting the needs of the customers and this is possible through external market research.

It is important for the company to carry out adequate market research to determine the solutions to the problem. Using the exploratory mixed method research, it is possible for the company to meet the research objectives efficiently. The validity and reliability of the data must be evaluated to ensure that only the most accurate tools and data collection sources are used. The secondary sources used in the data collection should be current to collect data that is relevant to the area of study. Further, the credibility of the secondary data sources must be evaluated using factors such as the educational background of the author and the extent to which the subject matter is covered. The reliability of the research will be determined by the accuracy of the research tools, that is the interview survey ad questionnaires. However, the researcher must consider the weaknesses of the data collection tools such as false responses by the interviewees. The researchers must be aware of the ethical concerns in carrying out market research. They should guarantee the confidentiality of the information provided by the respondents and should not carry out research without explaining its importance to the respondents.