Are you ready for the Wal-Mart (NYSE: WMT) TV Network? According to The Wall Street Journal, the retail behemoth plans to step up its efforts to advertise to shoppers through state-of-the-art TV monitors seeded throughout its stores. And if you think that could never work, think again.
Wal-Mart has teamed up with Premier Retail Networks Inc., and the companies share the spoils from the endeavor. Spots cost advertisers $50,000 to $300,000 for four weeks, depending on frequency, and reach 133 million viewers every four weeks. According to the article, data shows that average brand recall through Wal-Mart TV viewership is 66%, compared with 24% from in-home TV advertising.
Wal-Mart stores, many of which already have monitors, will be tricked out with plasma and LCD TVs. And theoretically, no longer will picking out the best head of lettuce be quite so dull. The article mentions that monitors will be installed at eye level in spots such as the produce aisle, where shoppers tend to tarry a little longer.
Even though consumers are fairly adept at tuning out advertising, it seems such an initiative has the power to convince shoppers to try out the newest gee-whiz product from consumer giants such as Procter & Gamble (NYSE: PG), Kellogg (NYSE: K), and Coke (NYSE: KO), especially considering that when you see the ad, you're in the store with less chance of forgetting what you've just been pitched.
It's another sign that traditional advertising is losing potency. The Internet raised the bar, allowing for annoying but effective personalized pitches. Then, TiVo (Nasdaq: TIVO) and other digital video recorders (DVRs) have greatly lessened the impact of TV advertising. Forrester Research recently reported that consumers with DVRs spend 60% of their time watching shows they've recorded, and while doing so, they skip a whopping 92% of the ads.
For now, it seems pretty likely that TiVo and its brethren will enter most households, too. Forrester forecasts that in five years, DVR households will increase to 41% from 5% at present, in large part because cable companies have grown wise to the technology's promise and are offering DVR products as part of their services.
So, Wal-Mart's foray into TV-style advertising is another spin on a recurring theme. More examples of experiments in advertising shift include Oprah's product placement, Coke's island retreat on Survivor, and Sears' (NYSE: S) reality show.
A guest spot on Wal-Mart TV could be an advertiser's dream come true, judging by the data thus far, and if it catches on, it might provide a boost to Wal-Mart's own top line. However, too much of this sort of advertising could easily result in a spectacular mass tune-out on the part of consumers. Time will tell.
What do you think of the Wal-Mart TV Network? Is this a great idea, or will it only serve to creep out customers? Talk about the idea on the Wal-Mart discussion board.
Alyce Lomax does not own shares of any of the companies mentioned.
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