As holiday shoppers crowd Wal-Mart stores this weekend to start their holiday shopping, the country’s No. 1 retailer is quietly moving on a plan to keep them coming back long after the last fruitcake has been eaten.
The plan, which encompasses many departments in the store, includes a noticeable warming of the cold war that has existed between the discounter and the music and video industries for years.
Wal-Mart, it appears, now believes one way to battle anemic projected sales gains is to get more people coming through its doors looking for hot music and video deals.
The battle plan calls for: Wal-Mart to carry edited versions of some controversial albums, the “tagging” of print and broadcast advertisements for the first time, and, exclusive deals with music stars like Garth Brooks.
For Wal-Mart’s music and video vendors, the plan, especially getting some edited albums into the chain, marks a clear change from the antagonistic relationship that existed years ago.
The initiative also come as Wal-Mart is staring at some of the smallest sales increases ever.
For rivals, Wal-Mart’s strategycan’t be good news. The chain is already the No. 1 seller of music and videos in the country but has not paid particular attention to the categories. The slumbering giant may be awakening.
David Porter, who heads Wal-Mart’s music and video business, admits parts of the plan are beginning to be put in place.
“We’re in the process of evaluating [tagging] and have some tests that will appear in the market during the next few weeks,” he said in response to some emailed questions.
“We’ll evaluate the results and make a decision based on those evaluations” about whether or not to permanently allow tagging.
Tagging is the “available at Wal-Mart” voiceover heard at the end of a TV or radio ad for a new album, or the store logo printed at the bottom of a print ad for an album.
Rivals Best Buy, Target, Tower Records and others have long allowed “tagging.”
That the nation’s largest retailer, fiercely protective of its corporate image, has changed its tune regarding tagging underscores the increasing importance Wal-Mart is placing on music to drive traffic to its stores.
The powerhouse now sells 15 percent of every CD sold in the country. The company does not break out music or video sales.
Porter, who was named the No. 21 most powerful person in entertainment – in a magazine ranking, is the man spearheading exclusive deals with music star Brooks and advertising campaigns featuring Destiny’s Child, Jesse McCartney and other stars in its “Home for the Holidays” campaign.
“We’re big fans of Porter and Wal-Mart,” said Derrick Graham, Wind-Up Records’ senior vice president of sales. “They’ve always been supportive of Wind-Up’s entire artist roster, including Creed and Evanescence when they were just developing artists.”
Artemis Records CEO Daniel Glass added, “Before David, there wasn’t as much reciprocity from Wal-Mart. But his team has been making a strong effort to work with us. You can feel him wanting Wal-Mart to be a more aggressive music partner.”
That new cooperative attitude, aimed at bringing a different kind of shopper to Wal-Mart, can also win over Wall St.
“The issue with big-box retailers is that they’ve had a tough time attracting traffic,” said Deutsche Bank’s Bill Dreher. “Entertainment is a very strong traffic-driver so there’s an economic incentive [for Wal-Mart] to have the category work for them.”
peter.lauria@nypost.com
Giant awakens
Faced with anemic projected sales gains, Wal-Mart is making nice with the music and movie industries, signing exclusive deal with Garth Brooks and others to draw even more traffic to its stores.
The plan includes:
* Agreeing to allow record labels to “tag” the discounter’s name onto their advertising campaigns.
* Prominently featuring Destiny’s Child, Jesse McCartney, Martina McBride and other musicians in its “Home for the Holidays” advertising campaign.
* Signing exclusive deals with BET and CMT.