Analysis of external communication media of the company


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Analysis of external communication media of the company

  1. 1. Analysis external communication media of the company The fundaments of a strong reputation are visibility, transparency, authenticity, distinctiveness and consistency. In the following we explain what media the company is using to develop a strong reputation. External communication media Visibility Transparency Authenticity Distinctiveness Consistency Website 7 5 6 5 7 Corporate blog 0 0 0 0 0 Annual Report 6 6 7 4 7 4 4 6 5 4 5 6 7 4 7 0 0 7 0 0 6 5 6 4 6 Advertisements / commercial targeted at customers Communication targeted at shareholders Reporting about multinational using Lexis Nexis Reporting in social media about the company 1. Website Wal-Mart has a big website with a lot of content. On the homepage they portrait the biggest discounts and actions. The company also has all of its products online, so that the customer can see what the assortment is. The website is put together nicely and has a lot of information on it. Not only about the products that Wal-Mart sells but also about the company itself. They talk about a wide range of different subjects such as; sustainable development, the way they treat the employees and renewable energy. At this point Wal-Mart even has a charity case for the Philippines. They raise money for the people who were victim of the large typhoon that occurred there. Because of these aspects we rated the visibility and consistency a 7 out of 7. What is also important, is to be transparent. As mentioned before, Wal-Mart gives a lot of company information. Of course this is only from one point of view; their own. It is good to get a lot of information about a company. Especially because not all companies do sustainable marketing. Because it is questionable if all the information stated on the website is 100% true, we rated this point a 5 out of 7.
  2. 2. 2. Corporate blog At this point we were unable to find a corporate blog of the company. We did start our own blog as a group. We would think that having a good corporate blog would be a nice extra to Wal-Mart’s transparency. This is why all points are rated 0 out of 7. 3. Annual report An annual report is a presentation of a company’s audited account for the previous year, as required in corporate legislation. In addition to the auditor’s report, an annual report commonly includes management’s review of the operations of the firm and its future prospects, balance sheet, income statement, cash flow statement and other supporting documents. Annual reports enable investors to stay up to date on a company’s yearly outlook.1 Wal-Mart publishes an annual report as PDF file on their homepage, so shareholders and other interested people can download the report and get information about the company’s financial performance and key strategies. The annual report from Wal-Mart includes the following contents: Five-year financial summary Management’s discussion and analysis of financial condition and results of operations Consolidated statements of comprehensive income Consolidated balance sheets Consolidated statements of shareholders equity Consolidated statements of cash flows Notes to consolidated financial statements Report of independent registered public account firm Report of independent registered public accounting firm on internal control over financial reporting Management’s report to our shareholders Fiscal 2013 unit count Corporate and stock information2 On Wal-Mart’s homepage you can easily find an annual report archive. Interested people can download the annual report from 1972 to today. Thus gives a good overview to the company’s development and a comprehensive knowledge about the financial performance.3 1 2 13-annual-report-for-walmart-stores-inc_130221024708579502.pdf 3
  3. 3. That’s why we rated transparency and visibility with 6 out of 7 points. Transparency and visibility, contributing to a good reputation of the company, are well implemented in these reports. Moreover the figures shown in Wal-Mart’s annual reports are authenticity and consistency. So it can be said that the information given in these annual reports for especially shareholders are well satisfactory. Therefore these two points are rated with a 7 out of 7. The wide content of the annual reports as mentioned above is sufficient and appropriate. As an annual report has to include certain points required by corporate legislation it can be said that the report isn’t distinctive to other reports from other retailer. Wal-Mart has to follow a guideline when writing their annual reports that’s why we rated the distinctiveness with 4 out of 7. Considering the reputation of Wal-Mart, the company contributes with this media especially to the dimension financial performance. 4. Advertisements / commercials targeted at customers Wal-Mart has spent a growing amount of its TV budget into spot, creating price-comparison ads against local retailers in 60 markets this year. The company produces an eye-popping 1,500 TV ads in 2013 that is more than double it ran in all of 2012. The retailer is still running a number of national ads but with the knowledge that grocery is a local business the company tries to be successful with its local ads.4 So Wal-Mart tries to be more distinctiveness with its local advertisements compared to other retailer and contributes with that to a better reputation. Moreover Wal-Mart invented a new TV-advertising campaign, which aims to show why the retailer is still so popular despite the disbelieving objections of elites that keep picking at the world’s biggest retailer. The new campaign focuses on the strengths of the company and explains how people benefit from the retailer by generating an endemic kind of cultural goodwill. These advertisements create a broader and more comprehensive argument for the positive success Wal-Mart achieves for the American economy. Wal-Mart pronounced that they embark on this new path, because the retailer knows that people trust in a company even more when they understand the opportunities the company provides for their staff, their customers and how the retailer is able to deliver low prices. The more Wal-Mart explains people what they do and how they do it, the more the public understand the positive difference Wal-Mart can make for customers, associates and communities. So it can be said that the company tries to be more visible, transparent and distinctive compared to other big retailers. In one of these new ads Wal-Mart shows its different types of customers and they are briefly telling what they’re doing with the money they’re saving by shopping at Wal-Mart, ranging from investing in a college fund to affording braces for their kids. Concerning this ad it is obviously that Wal-Mart tries to be more authentic. The customer can identify with one of these persons. That’s contributing to a better relationship to the company. Therefore authenticity is ranked with 6. With its new U.S. advertising campaign, Wal-Mart tries to be more visible and transparency to its customer. The company is on the right track but they still have to improve a lot in this 4
  4. 4. direction as they are still negative discussions about Wal-Mart transparency and visibility. That’s why we ranked these two points with 4 out of 7. Due to the local advertisements and the new TV-advertising campaign Wal-Mart tries to be more distinctive compared to other retailers. As the company tries to have different advertisements and commercials we ranked distinctiveness with 5. It’s difficult to say Wal-Mart fulfils consistency with an advertisement or commercial as a company tries to catch their customer with it. That’s why they show just the positive aspects of themselves to convince their customers to be the best choice. Consistency is ranked with 4 out of 7. 5. Communication targeted at shareholders As we know, an essential element of investment in the financial markets is information. Very often this information is proven to be a decisive factor in making investment decisions . The appropriate dosage of information and proper communication with investors can be very important source of competitive advantage, and thus the key to the success on the stock exchange for the companies. The basic element of the broader communication with shareholders and investors are already described in our report - periodic reports ( quarterly and annual reports ) and published to date financial results , along with the levels of financial indicators. This is very important because each shareholder as well as potential future investor must have a thorough knowledge of what is currently going on in company and what is the company's financial condition and growth prospects. Due to the fact that the publication of the above information is required by the company to participate in the stock market and it is not possible to derogate from that it can be safely assumed that Walmart is doing in this regard as well as the other companies listed on the NYSE. The next tool for Walmart for communication with shareholders is the website . On this website bears a special tab investors5. In addition to the information already described , we can also find there many additional threads dedicated to investors. We can find , for example, the link shareholders service, which includes , among others, a link to a special website – Computershare . Computershare - the leading global stock transfer agent and shareholder services provider – is Walmart 's stock transfer agent and employee plans administrator.6 What is more service called financial e-mail aletrs is available. This allows shareholders to receive email alerts from financial Walmart and stay current on our SEC filings , events , news and more.7 For investors Walmart also offers special mobile application called Walmart Investors Relations App, which gives investors easy access to Quarterly Results , Financial News , 2012 Annual Report , 2012 Global Responsibility Report and the Walmart Stock Price.8 On the financial market we are dealing with two types of shares: ordinary shares and socalled non-voting shares. The first one of these gives the right to presence and possibility to vote at general meetings of shareholders for the holders of such shares. The second type of them is not privileged in the same way, and only provides the holder the right to dividends. General meetings of shareholders of Walmart are therefore also part of the company's 5 6 7 8
  5. 5. communications with shareholders but only these who have ordinary shares. Walmart, a company fully aware of all of its shareholders each year organizes a meeting of all shareholders regardless of the shares held by them, and a number of other events designed to improve communication between the company and its investors.9 6. Reporting about the multinational using Lexis Nexis (peer reviewed journals) Apparently Wal-Mart has not been using that much Lexis Nexis for reporting. True to be told, Wal-Mart has not been reporting in any reviewed journal in particularly. Some articles can be found, but it is not in the top reviewed journals with high impact factor. Recent data shows lacking of internal information about the Wal-Mart and its organization, again see the problem with transparency. It has been long time since Wal-Mart was in journals with high valuation of its knowledge or system, as it was at the beginning – supply chain system etc. Obviously, reporting about own activities doesn’t effect business that much, however it could be an interesting topic for discussion, especially it could be used as school material, getting more information about organization and its characteristics. That has been cause of evaluating of distinctiveness, visibility, transparency and consistency by 0 point. Only authenticity got marked 7, the highest, cause those reports (even so few about it) were highly authenticate and well prepared. 7. Reporting in social media about the company. Social media is in these days neccesity for companies, as it offers unique opportunities to communicate with customers. However, to set up social media strategy right isn’t an easy task, and the brands that are achieving the best results tend to be those which have been taking risks and have been trying new things. Wal-Mart has done great job, and that’s why we have evaluated its visibility by 6 points, transparency by 5, authenticity again by 6, distinctiveness by 4 and consistency by 6 points. There has been done some great job from the Wal-Marts´ perspective and it has been paying off. Details are provided for each of form communication via different social media below this text, however we can say, that Wal-Mart understood trend of communication via social media very well, it has been well known and only part, which could be done better is part which cover information about social responsibility of the company. Facebook Start with Facebook, Wal-Mart has put a huge amount of effort into developing its Facebook presence, and has embraced the timeline to showcase how the brand has grown over time. The retailer has clocked up a whopping 26m fans – an increase of 9m since last July – who it entertains with a confusingly broad range of updates. A majority of Wal-Mart’s posts are just product suggestions, but it also includes caption competitions and sports chat, as well as trumpeting its sustainability credentials.10 9 10
  6. 6. Wal-Mart posts between two and five updates per day, including weekends, and most achieve an impressive number of responses from its fans. Most of its posts achieve tens of thousands of ‘likes’ and hundreds of comments, with pictures of pets and children proving to be particularly popular.11 However not everything Walmart touches on Facebook turns to gold. In October 2011 it partnered with the social network to create 3,500 pages for its local stores across the US.The idea was to build brand loyalty with “enhanced local interaction at an unprecedented scale", but as of last September the results were unsatisfying. Pages for local stores were not able to create enough fans and they were not attractive. Wal-Mart has been using Facebook as main tool for its social media communication, however there is lacking information about the goals, strategy, global responsibility, which could have a positive effect on Wal-Marts´ reputation. Twitter Walmart mainly uses Twitter to post questions; with topics ranging from sports, caption contests and requests for retweets if users agree with a certain statement. Most of its tweets only get a handful of responses, and it does a good job of answering those users. 11
  7. 7. However it also responds to hundreds of tweets a day from other users, and has the hashtag #WalmartElves to help customers who are looking for gift inspiration. Clearly Walmart sees the value of using Twitter to engage with its customers rather than just using it to churn out marketing messages. It has managed to clock up 307,000 followers, which is impressive but still someway behind rival retailer Target which has more than half a million. Walmart also operates several other Twitter accounts that focus on its sustainable initiatives, healthy food, and charity and community programs. However these are far less popular than its main account, and all have around 10,000 followers.12 Google+ Walmart joined Google+ back in December 2011 and has posted a whopping two updates since then. Walmart is extremely active through its other social channels, so we are dubious that this one is real but in truth there’s no other reason to doubt its validity. If anything, Google should be quite concerned that Walmart has neglected to maintain a G+ page while putting so much effort into other social networks, though I doubt Eric Schmidt will lose any sleep over it.13 But as has been said, Wal-Marts´ focus is on Facebook and twitter account, which uses for promoting and communication with the customers. Thus both are successful, there could be some more information about Wal-Marts´ activities in global responsibility. 12 13