Doug McMillon's TV and social media ad spot is part of a push to
burnish the retailer's image
By Sarah Nassauer
Wal-Mart Stores Inc. wants chief executive Doug McMillon to do
more than boost sales: it is leaning on the CEO to burnish its
image.
More CEOs are raising their public profiles, speaking out on
issues and appearing in ad campaigns, but it remains an unusual
move for the world's largest retailer. In what is believed to be a
first, Wal-Mart cast a CEO in a commercial that aired on social
media and television for about three months through the end of
September. The ad, starring Mr. McMillon, touts the company's
commitment to employees, not the latest deals.
Putting top executives in advertisements can build credibility
for companies and rally staff, but it can be risky -- highly paid
executives may garner little sympathy, and some lack the charisma
for the job. In cases where the CEO is central to the brand, as
with ousted Men's Wearhouse founder George Zimmer, the company can
be left scrambling after that leader leaves.
Mr. McMillon's 30-second spot is part of a wider push by the
retailer to shed perceptions that it offers little more than low
prices and low-paying jobs, labels that have long dogged the
company.
"I'm Doug," he says in the ad, surrounded by produce in one of
the company's stores near its Bentonville, Ark. headquarters,
flipping through photos of employees on his Instagram account.
"Here at Wal-Mart we are committed to taking care of the people
that take care of you," he tells viewers.
The ad ran this summer during "Fox and Friends," George Lopez
and SportsCenter, as well as on Facebook and Instagram. Wal-Mart
declined to say how much the ad campaign cost.
Dan Bartlett, Wal-Mart's vice president of corporate affairs,
conceived of the campaign with his team, say people familiar with
the process. The "reputational ad" highlights Wal-Mart's promise to
invest $2.7 billion in higher wages and employee training.
An "associate CEO" who started his career in a Wal-Mart
warehouse in 1984, Mr. McMillon is a natural to deliver a message
aimed at employees and policy makers, Mr. Bartlett said. As CEO
since February 2014, Mr. McMillon has raised store employee wages
and is building hundreds of management-training academies.
Executive pitchmen came into vogue after Chrysler ran memorable
ads in the 1980s featuring CEO Lee Iacocca asking shoppers to give
the embattled brand another chance. Some companies such as Papa
John's International Inc. featured its CEO in nearly every ad;
Apple Inc. recently nodded to its rabid fans by casting Senior Vice
President Eddy Cue and other executives alongside late-night host
James Corden in an Apple Music TV commercial.
Nonetheless, most executives have preferred to remain in the
background, unwilling to appear publicity-hungry or risk drawing
negative attention to themselves, according to Leslie Gaines-Ross,
chief reputation strategist at communications firm Weber Shandwick.
In the age of hyper-sharing on social media, "everything is
different," she said.
Mr. McMillon's actions on wages and his consistent focus on
employees make him a plausible pitchman, Ms. Gaines-Ross said. The
50-year-old executive appears younger, "not some CEO of the 50th
floor who never talks to employees," she added.
CEOs generally appear in ads for two reasons: to build
credibility or to acknowledge a mistake, says Pradeep Chintagunta,
a professor of marketing at the University of Chicago Booth School
of Business. In a 2010 Domino's Pizza Inc. ad, President Patrick
Doyle discussed customer complaints about artificial-tasting pizza
with cardboard-like crust and vowed to improve its food. Many
customers appreciated his candor, Mr. Chintagunta said.
Wal-Mart founder Sam Walton famously believed that his company
didn't need to court elites. But as the retailer grew to the
world's largest company by revenue, scrutiny on its dealings
intensified and leaders changed tack. Mr. McMillon in particular
has embraced a public profile, posting often to his Facebook and
Instagram accounts.
It is unlikely that Mr. McMillon's ad changed many viewers'
minds, says Peter Daboll, chief executive of Ace Metrix, a firm
that measures the impact of video advertising and doesn't work with
Wal-Mart. "You have a lot of people who are sensitive to Wal-Mart
and labor issues that just didn't buy into this guy," questioning
his high salary in survey comments, he says. Ace Metrix, which
tested the Wal-Mart ad, surveys 500 viewers for each ad tested.
(Including stock awards, Mr. McMillon earned $19.8 million in
fiscal year 2016 which ended Jan. 31, 2016.)
Wal-Mart always will have critics, but employees and policy
leaders responded well to the ads, according to Mr. Bartlett. They
liked that "the CEO is going on a TV and saying it's a priority,"
to support workers, he said, adding that the company has no plans
to put Mr. McMillon in future ads.
Google searches for 'Wal-Mart CEO salary,' spiked during the
summer when the commercial aired to the highest levels since Mr.
McMillon was announced as chief executive. Searches for 'Wal-Mart
CEO' and 'Doug McMillon' also rose. He gained about 10,000
followers on his Instagram account, where commenters call him
"commercial guy."
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
October 19, 2016 02:48 ET (06:48 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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