Wal-Mart CEO: More Newspaper Ad Spending Unlikely

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By: Jennifer Saba

Wal-Mart President and CEO H. Lee Scott said that after spending $73 million in newspaper advertising last year, he is aware that publishers would like to see the spigot turned up.

“I know you would like to see more,” Scott told a group of newspaper publishers at today’s closing lunch at the Newspaper Association of America’s annual meeting in Chicago.

But a very candid Scott delivered the news that more spending was unlikely.

“I wish we had results from newspapers,” Scott said, adding he wanted to see advertising accelerate growth. When Wal-Mart measured the effectiveness of newspaper advertising, Scott said it “didn’t give us a return.”

After the speech, the question was raised if there was a better way of using newspapers. He added that he wasn’t going to walk away from newspapers and Wal-Mart is open to figuring out a way that would serve the industry and the company. “We need to continue to figure out if there is a different way.”

Scott did acknowledge that there was a rift ever since the company decided in the early 1980s to stop ROP advertising in newspapers. “Fundamentally, we moved away from each other,” he said.

During his speech, Scott drew a picture of similarities between newspapers and Wal-Mart and how both are dedicated to serving communities.

Wal-Mart has met resistance from communities — especially urban places such as Chicago — over plans to open new stores and Scott addressed how he planned to remedy the problem.

For example, Chicago’s south side rejected Wal-Mart proposal for opening a store. Scott explained they did manage to open a new Wal-Mart in nearby Evergreen Park. “It was right to build that store” and give the community an economic opportunity, he said.

Over the next two years Wal-Mart plans to expand with 50 big box retail units in places that need it the most — places like vacant buildings or areas that need economic revival. Scott said Wal-Mart plans to work with small businesses surrounding new stores and help them “thrive,” adding that Wal-Mart has never been afraid to invest in overlooked communities. The company plans to donate $500,000 over two years to chambers of commerce in the “zones” of interest.

Scott also called for heathcare reform in this country explaining that rising costs could hamper global competition.

He also acknowledged that Wal-Mart is going to get more involved in political debates. “If we are going to be singled out in this country, we’ve got to get in the debate,” he said adding that he wanted every company to be treated the same. “I would rather walk stores than give talks,” Scott remarked as the convention came to a close.

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