New era of trust and transparency at Walmart

Walmart announced continued and increased commitment to their sustainability initiatives in a press release today, simultaneously introducing “a new era of trust and transparency”, as noted by Walmart President and CEO Doug McMillon. Some high points include a goal to double sales of locally grown produce in the U.S., expanding and enhancing sustainable sourcing to cover 20 key commodities, including bananas, coffee, and tea, and implementing a new plan designed to achieve science-based targets for reducing greenhouse gas emissions. Walmart is the first retailer with an emissions-reduction plan approved by the Science Based Target Initiative, in alignment with the Paris Climate Agreement in December

This is all good news in a time where corporate commitment to sustainability seems to supersede governmental engagement in addressing the consequences of climate change on our planet. I applaud the company for their leadership in this concerted effort as, when Walmart changes, tremendous opportunities arise.

Trust and Millennials at Walmart

However, an interesting question is if the new sustainability initiative can indeed help change Walmart’s trust deficit, and, in particular, motivate millennials to favor Walmart (as store and as employer). This may partly depend on Walmart’s future approaches to communicate with, not to, consumers. For example, Walmart’s focus on locally grown produce appears to be very much in line with consumers’ demand. The local food movement has grown considerably over the past few years, although it still only represents a small share of total U.S. food sales. While presenting a great business opportunity that Walmart and other major retailers noticed early on, the success of the local food movement is partly founded on many consumers’ erroneous assumption that buying local food is generally a more sustainable option in that it will support the small businesses in their community, is healthier, and has lower environmental impact. But “local” means just that (usually, it’s equated to mean that food was produced within a certain radius). It could still come from a mega-farm, have the identical nutritional value as traditional products, and, given that only a small portion of the environmental footprint of food is attributable to transportation, be similarly sustainable. To my mind, increased transparency would mean to enable consumers to make informed choices, not just to offer them pre-screened product options, at low prices. Moving the trust needle in favor of Walmart implies that embracing a business opportunity such as local food can be achieved in a manner that also fully supports consumers’ and society’s goals, making the consumer an active part of the solution. For Walmart, it may also mean to credibly communicate changed values, and to continue to work on establishing an evolved reputation.

It will be truly exciting to follow how Walmart continues to address these challenges.

Sabrina V. Helm is Petsmart Associate Professor of Retailing and Consumer Sciences at the University of Arizona where she teaches Consumer Behavior as well as Marketing Strategy. She is also the Co-Director of the Consumers, Environment and Sustainability Initiative (CESI) at the University of Arizona. Prior to joining UA, she was Professor of Strategic Marketing at Witten/Herdecke University, Germany’s premier private university. In her research, Sabrina focuses on customer bonding strategies, customer valuation, referral marketing and reputation management. Current research projects also include studies on consumer mindfulness and its effect on pro-environmental behaviors, and studies on consumer perceptions and anxiety with regard to the threats of climate change.
Sabrina received her Ph.D. in business administration from the University of Duesseldorf, Germany. She also holds a post-doctoral degree granted by the University of Duesseldorf. Prior to her academic career, she worked as assistant to the CEO of a mechanical engineering plant and as a specialist in museum marketing.