Walmart’s annual shareholders meeting focuses on change of pace
FAYETTEVILLE, Ark. — Walmart chairman Rob Walton encouraged employees to “go for it,” and president and CEO Doug McMillon said the company would accelerate the pace of change during the company’s annual shareholders’ meeting June 6 in Fayetteville, Ark.
McMillion, presiding over his first shareholders’ meeting since being named CEO earlier this year, left an immediate stamp on the event. Event host Harry Connick Jr. introduced McMillon, who was surrounded by thousands of company employees in the upper deck of the Bud Walton arena on the campus of the University of Arkansas. After engaging in some witty banter with those seated near him, including removing an Alabama hat from a youngster — McMillion is an Arkansas alum — he took a selfie with an employee and then turned the meeting back to Connick.
It was significant change in meeting protocol, but it helped underscore the theme of a nearly three-and-a-half-hour event where the emphasis was on change and accelerating innovation while maintaining certain foundational principles. McMillon described how Walmart will lead with urgency to get ahead of change by focusing on three areas.
“First, we will be a customer-driven company. We’ve always said the customer is our boss and we’ll make decisions based on how we can serve them better,” said McMillon. “Second, we will invest in our people. As we change and grow, it will be our associates who will make the difference. Finally, we need to be at the forefront of innovation and technology.”
Walmart envisions a future where it is uniquely positioned to win at the intersection of digital and physical. To do so, McMillon and other top executives described how the company is making acquisition and investments in its Global eCommerce organization and big data analytical capabilities even as it continues to expand its worldwide physical footprint.
“Customers will increasingly expect and require the best of both worlds. They want the excitement and the immediacy of shopping in a physical store and the freedom to shop whenever, however and wherever they want. They want an experience that seamlessly adapts to their life,” McMillon said. “Walmart can bring together our stores with new digital commerce capabilities to help customers save money, save time, and have access to what they want and need. Walmart will exceed their expectations.”
By some accounts the company is already doing so. Its e-commerce business is on track to grow to about $13 billion this year from $10 billion last year, but McMillion and Neil Ashe, president and CEO of Walmart Global eCommerce, were adamant about the opportunity to go faster.
“Our stores, 11,000 and growing, will provide access and convenience. If you need it right here, right now, we’ve got it,” McMillon told the roughly 15,000 people who filled the arena for a meeting that began promptly as 7 a.m. with a rousing rendition of “Happy” by Pharrell. “We will run great stores and clubs with great associates. We’ll keep adding services and pick-up points to our stores to become even more convenient. We’ll also strive to have collection points wherever our customers want us to be, and we’ve seen the demand for food delivery in places like the U.K., Mexico and China. And of course, we’ll keep improving our traditional e-commerce offering of ordering online and shipping to customers’ homes.”
McMillon also described how Walmart will develop new capabilities to serve customers in new ways.
“It is important that we all understand the shift that has happened in technology and retail, what it means for us and what we’re doing to win. There’s a lot of innovation and opportunity available to us.” McMillon said.
Walmart names Greg Penner vice chairman
BENTONVILLE, Ark. — Wal-Mart Stores chairman Rob Walton announced the appointment of Greg Penner as vice chairman at the company’s shareholders’ meeting Friday morning, a move that positions Penner, Walton ‘s son-in-law, as his successor.
“One of the board’s most important responsibilities is long-term succession planning, and the company spends considerable time planning for stability and continuity, both at the board and management level,” said Walton, who will remain chairman of the board of directors. “In keeping with this commitment, I’m pleased with Greg’s appointment. Walmart has benefited from his broad expertise in strategic planning, finance and investment matters. I’m excited about Greg working closely with me, the Board and the management team in guiding Walmart into the future.”
Penner has served on Walmart’s board since 2008. He is chair of the Technology and eCommerce Committee and also serves on the Global Compensation and Strategic Planning and Finance Committees.
“I am committed to the long-term success of Walmart,” said Penner. “My first Walmart experience was in 1994 and over the years I’ve developed a deep appreciation for our associates and their service to our customers. I look forward to contributing to a stronger Walmart in any way possible including how we develop new digital capabilities to add to our store offering. This is an exciting time to be part of Walmart.”
Penner has been a general partner of investment management firm Madrone Capital Partners since 2005. From 2002 to 2005, he served as Walmart’s SVP and CFO, Japan. Prior to that role, he was SVP of finance and strategy for Walmart.com. Before joining Walmart, Penner was a general partner at Peninsula Capital, an early stage venture capital fund, and a financial analyst for Goldman Sachs & Co.
FIT’s beauty think-tank research predicts dramatic shifts in beauty landscape
NEW YORK — In partnership with Unilever, graduating students in the Fashion Institute of Technology’s Cosmetics and Fragrance Marketing and Management Master of Professional Studies program revealed insights into future beauty consumers and the methodologies that beauty companies should adopt to remain competitive.
The Capstone Research Presentation for the 2014 Unilever-sponsored FIT’s Cosmetics and Fragrance Marketing and Management Master’s Program was held Wednesday evening in New York City at FIT in the Haft Auditorium.
"At Unilever we deliver world class innovation based on rich insights that create meaningful connections with our consumers, and we know that what’s relevant today may not be tomorrow as demographics continue to evolve," stated David Rubin, marketing VP Unilever Hair U.S. "The dynamic and intelligent graduate students of FIT’s Cosmetics and Fragrance Marketing and Management Master’s Program have come together to take on imminent challenges of the business, such as ‘The Changing Face of the Beauty Consumer.’ We at Unilever are honored to partner with FIT to help foster the growth of these prospective industry leaders."
Each year the graduating class presents forward-thinking capstone research along with industry predictions and proposals for beauty companies. This year’s CFMM capstone research focused on the evolution of the beauty landscape, exploring "The Changing Face of the Beauty Consumer" across three key areas — accessible beauty, the new beauty consumer and men’s beauty and grooming.
Accessible beauty: introduces a new name for a growing consumer group: progressive rationalists. This group regularly trades up and down, necessitating a different approach for reaching them. Key findings include:
- By 2030, there will be a 50% decline in global poverty, leading to strong middle class consumerism.
- Asia will surpass the United States and Europe in GOP, population, military spending, and technology investment; and
- Global migration will increase due to an aging population in developed countries.
- The industry should adopt a new model called Progressive Consumption Equation: [function + higher order need] + performance = purchase; and
- Brands must focus on three higher order needs: convenience — brands need to be hyper accessible by empowering local consumers to become points of distribution, utilizing the franchise method of "buying in"; clarity — brands need to leverage radical transparency, from philanthropy to profits to resources; and cash — brands must help consumers save money by developing the next generation of private-label products everywhere consumers shop, without risking brand image.
Engaging the new beauty consumer presents a new strategy that leverages total consumer identity. This new strategy moves beyond the traditional segmentation model of race, sex, age and geography. Key findings include:
- By 2030, race will transform into cultural values. The United States will no longer be a melting pot, but a mosaic of mixed ethnicity creating individual ethnicities;
- The range of gender identities will significantly broaden. Even today, Facebook offers 56 options for gender;
- Age will evolve into cross-generational passions. By 2050, people aged 65 and over will outnumber the young, and age will no longer define product need; and
- Geographic borders will no longer limit the definition of community. Instead, connections, intertwined with community, will define geography.
Recommendations: Brands must implement four key strategic initiatives:
- Exchange: Establish a cultural exchange between brand values and consumer values;
- Individual reality: Connect with consumers’ key personal moments throughout the year, not only on national holidays;
- Connectivity: Become part of a consumer’s unique community by leveraging technology and data to deliver a real and personalized experience; and
- Organizational Framework: Ensure that all marketing and sales teams have access to and responsibility for consumer insights.
Men’s Beauty and Grooming explores the increasing complexity that modern men encounter in today’s society. The research focuses on the changing economic and social attitudes toward masculinity that are impacting male grooming habits. The industry is at a tipping point where external drivers are altering men’s wants, needs and aspirations. Key findings include:
- Changing roles: 3-out-of-4 men agree that men and women no longer need to conform to traditional roles and behaviors;
- Changing views: 76% of men agree that males are under more pressure than past generations to present a polished image;
- Changing faces: Population growth for the older male segment, combined with millennial men being more accepting of women’s grooming products and routines, will positively impact product adoption and usage.
- If brands are able to increase men’s yearly product purchases from five to seven items, at an average of $10 each, the U.S. market could reach $10 billion by 2030, 30% higher than currently projected.
Recommendations: A four-gear approach is critical to men’s grooming, each one representing a network of interdependent action:
- Ignite: Identify authentic needs and genuine consequences by introducing credible, simple solutions;
- Steer: Leverage key influencers and focus on ease, accessibility and trust;
- Fuel: Utilize imagery and communications reflective of the dynamic state of masculinity; and
- Accelerate: Focus on one hero product at a time, building momentum, sophistication, trust and loyalty over time.
"Working with a world class consumer packaged goods company like Unilever as a partner, the faculty and class of 2014 were excited to explore the consumer of 2030, and how evolving cultural values, universalization, changing notions of life stage and gender, and the rapidly changing socio-economic landscape globally will impact on how brands innovate and communicate to connect with their consumers" stated professor Stephan Kanlian, chair of FIT’s graduate program. "We are truly at a tipping point, with the convergence of social conscience in the developed markets and the rising global middle class in the developing world, and these forces are sure to effect widespread changes in the consumer landscape of 2030."
Click here to access the full research white papers for "The Changing Face of the Beauty Consumer," along with white papers for past presentations