Walmart is such a juggernaut that finding some bit of news that proves bad PR for the brand is about as easy as, well, finding a good deal at a Walmart (which is opening at 10pm on Thanksgiving Day, getting a jump with Target, Macy's, Best Buy, Kohl's and other retailers for whom Black Friday is Not Enough).
Case in point: "Jerseyville Wal-Mart sued over customer's slip." Or: "Wal-Mart ready to settle Netflix case for $27.5M." But two new developments cast the brand in an especially tough light, with one in a perfect position to link up with the 99%er movement.
The brand that Sam Walton built has long been known for its thriftiness. Its executives, legendarily, fly coach; we wouldn't be surprised if they sleep two-to-a bed and shower together, too, to keep those T&E costs in line. But it isn't staffers but the activities of Wal-Mart heiress Alice Walton, America's 10th richest woman, that have come under examination.
Alice's latest project, the $1.4 billion-budgeted Crystal Bridges Museum for American Art in Bentonville, Arkansas, comes just as Wal-Mart makes cuts to employee benefits.
The protests outside the museum have naturally dovetailed nicely with the Occupy Wall Street movement, bringing an especially large amount of unwanted attention Wal-Mart's way. But a lot of the outrage seems to be party due to geography.
That is to say, a robber-baron-like billion-dollar museum of art in New York, Miami (which has its share of culture clash), or Chicago might not rankle the way one plopped down in rural (poor) Arkansas does. As one spokesman for union organization Making Change@Walmart told Britain's The Guardian, "Opening a huge, opulent museum in the middle of nowhere while the company is cutting health insurance for its employees is troubling. It sends the message Wal-Mart doesn't care about them."
But the rich are not like you and me, and this one's an easy task for Wal-Mart's PR department: It's an art museum, open to the public, and not a shoe collection for a pet elephant or a life-size private jet made of chocolate or something. Far more potentially damaging is another bit of news out about Walmart.
The company is now defending itself against a racial discrimination lawsuit which alleges that the mega-retailer conspired against African-Americans at the store's 30 Minute Health Clinics. More damaging, this action is not coming from a lone shopper or a class action, but from ... 30 Minute Health Clinics.
The 30 Minute Health Clinic™ CEO contracted with Wal-Mart to open a location in its Little Rock, Arkansas store. But, the CEO alleges, after the clinics began attracting a large number of "suspicious" and "uncontrolled" "black males" and "black females," Wal-Mart canceled the contract and had the locks changed. Those terms, by the way, were from transcripts of Wal-Mart's complaints to the police.
The details of the charges are so far one-sided. But history in Arkansas is not exactly on Wal-Mart's side. Two years ago the retailer settled a case of racial discrimination against African American truck drivers for $17.5 million. The brand, of course, admitted no wrongdoing.
With the economy continuing to lag, Wal-Mart is in a battle to grow. Last week, the retailer reported Q3 earnings short of projections as income fell 2.9 percent. But investors see promise for the retailer as actions such as its layaway program has been a hit. JP Morgan upgraded Wal-Mart's stock (even while downgrading competitor Target's). And with consumer spending showing signs of a stronger heartbeat, Wal-Mart executives are predicting above-expected holiday performance.
Still, it's hoping to grow its healthcare business, and can't afford to disenfranchise its African-American base of consumers.