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How a messy Wal-Mart satisfies customers

On a recent trip to Wal-Mart, we were treated to the store's usual array of messiness: dirty floors, open packages and poorly retaped packaging from returned merchandise, misplaced merchandise, and generally uncontrolled dingy clutter. This seems to be the case at every Wal-Mart location in the country -- except the brand new ones. When a new location first opens its doors, it is always a sparklingly clean example of retail efficiency. Not only is the store pristine, but every single one of those 30+ checkout lanes is open for business. Come back six months later, however, and you'll find a dumpy, dirty store standing in its place. By then, the corporate gods of cleanliness -- and the people who man those extra cash registers -- will have moved on to another new location (or as is more likely these days, a newly refurbished location).

So I wondered, how does Wal-Mart get away with this in city after city, neighborhood after neighborhood? The obvious answer is price. With the country in the midst of a full scale recession, low price is big motivator for customers.

But I think there's more to it than just that. I recently listened to audio version of Super Crunchers, a book by Yale Law School professor Ian Ayres that discusses the growing use of statistical analysis of datasets to make more precise business decisons. One example Prof. Ayres outlines in the book involves an airline that tests three separate strategies on customers who had a triggering negative event (e.g., a cancelled flight) during their travel with the airline. The first group received nothing, the second group received a letter of apology, and the third group received a letter and a trial membership in the airline club. Members of the second group were far more likely than those in the first to book future travel with the same airline even though they received nothing more than a form apology. As for the third group, about a third of those actually renewed their club membership when their trial expired, meaning the scheme actually resulted in additional revenue for the airline -- from customers who had a negative experience with the airline, no less!

So how does this play into Wal-Mart and its messy stores? Well, at the checkout counter these days there is usually a question displayed for customers on the credit/debit card machine: "Was your store clean today?" Whether Wal-Mart actually uses the responses to adjust its store cleaning strategy is anybody's guess, though surely the higher ups are aware of the cleanliness problem in many of their stores and this is a clever way to pinpoint problem locations. But what this question definitely achieves is giving the customer the satisfaction of providing feedback. Thus, if I am appalled by the messiness of the store on a given day, I can angrily select "No." This will probably make me feel a lot better because Wal-Mart actually provided me with an opportunity to vent my frustrations. Better yet, I am able to do so in a non-confrontational way. As a result, I leave the store more satisfied with my shopping experience and am more likely to return.

Of course, as Wal-Mart surely knows, I'd be even more satisfied and likely to return if I had selected "Yes."

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