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Customer Experience Lessons From Walmart

Former Walmart CEO Lee Scott discussed the changing consumer landscape, and the big box store's foray into financial services, at BAI Retail Delivery 2013.

Knowing what is happening in a customer's life is imperative for any business to be successful these days, especially so in financial services, says Lee Scott, former president and CEO of Walmart.

Scott, speaking during a keynote session this week at BAI Retail Delivery 2013 in Denver, also stressed that being relevant to a customer does not mean being overbearing. He used the example of a bank that had sent him information regarding a specific financial product multiple times even after he had not expressed an interest.

"Customer service and trying to push something on someone is different," says Scott. "If communications with customers are not meaningful, not only will they tune you out, but they may move to someone more relevant."

In Walmart's case, that means knowing the demographics of its customers. Even though the big big box store is known for its low prices, Scott says a Walmart in an upscale suburb of Dallas, for example, wouldn't emphasize bargain-priced items in every endcap, because a customer there likely "wouldn't feel like they are opening price point customers."

Scott also discussed the effect Amazon and the rise of online retailing has had on Walmart, and how that parallels with increasing competition banks face from non-traditional competitors in payments and other areas. One such competitor, in fact, is Walmart, which offers financial services including check cashing and wire transfers. The chain this year also introduced Bluebird, a new product in partnership with American Express that is designed to be an alternative to debit and checking accounts. Bluebird is an American Express-powered card that is available online and at more than 4,000 Walmart stores.

[Related Content: Walmart Takes on Banks]

Scott says Walmart initially got into offering check cashing and wire services to aid its large Hispanic immigrant customer base, who typically used independent check cashing businesses that charged 6-10 percent for its services. Walmart charges 3 percent for check cashing services.

The idea for Bluebird also came from serving this customer base, whom Scott described as those likely to pay mostly in cash during their weekly shopping at the store.

Interestingly, Scott says he does not see Bluebird as potential disintermediation for banks, but rather as something that will drive more consumers to banks.

The typical Bluebird customer, "is unbanked," notes Scott. "We've converted a number of them to Bluebird and it has been good. They're in the financial system now, and ultimately I think that's better for the people in this room, because those people will migrate from Bluebird to banks."

Bryan Yurcan is associate editor for Bank Systems and Technology. He has worked in various editorial capacities for newspapers and magazines for the past 8 years. After beginning his career as a municipal and courts reporter for daily newspapers in upstate New York, Bryan has ... View Full Bio

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