SPENCER STUART CMO SUMMIT

MARK HAMSTRA

CHICAGO - Wal-Mart Stores is becoming more responsive to customers at the local level, the chain's chief marketing officer said at a meeting for marketing professionals here last week.

"Retail will be won and lost locally," said John Fleming, who took the top marketing post at the Bentonville, Ark.-based retail giant last year after heading up the company's dot-com division. "We are going to have to get very good at understanding what our local customers want, and keep it within the confines of what our brand stands for."

Speaking at the Spencer Stuart CMO Summit, Fleming said the recent opening of a Wal-Mart in Plano, Texas, that received a lot of publicity for its high-end offerings is an example of the company responding quickly to local customer demands. He said although the media cited the store as an indication that Wal-Mart was "going upscale," the store was merely an example of the marketing team's ability to work with merchandisers to respond to customer demands, with the support of top management.

"Marketing was able to take what the customer wanted and implement it," he said, adding that the store is generating 40% more sales per square foot than comparable locations.

Fleming said that although marketing is often thought of as a "spend" that is used to drive sales, he sees it as an advocate for the consumer within the company that helps Wal-Mart be more responsive to consumers.

"If the organization is customer-focused, it's a given that marketing will have a seat at the table," he said. "It's not enough to drive produce sales. It is about how do customers feel about the produce."

Another example of Wal-Mart responding to customers' preferences can be seen in store layout. The company traditionally placed consumables and groceries on opposite sides of the store in an effort to drive traffic through the whole facility, but now Wal-Mart is placing the two high-frequency departments next to each other to make shopping more convenient, Fleming noted.

Fleming's experience at walmart.com helped him gain an appreciation for customer-responsiveness. "There has been this trend where customers are gaining more and more control, and the Internet has taken that to a whole new level," he said.

In response to a question about recruiting good employees, Fleming noted that Wal-Mart is increasingly looking outside the organization for new talent.

"Wal-Mart has been known to be internally focused, but we need that diversity of thought," he said, noting that he spends about a third of his time on "finding the right people."