MAYO Communications

“Wal-Mart Supercenters – The Economic Impact”

Objectives: The Los Angeles County Economic Development Corporation (LAEDC) was planning to release an economic impact study on a move to allow Wal-Mart Inc. to open 40 “Supercenters” – upsized stores that sell the retailer's general offerings alongside a full-service grocery operation – in Southern California. The company said it could save consumers money and create new jobs in the region. LAEDC needed to educate the public about this issue that could potentially affect every community in California, especially Southern California. Wal-Mart, which paid for the $65,000 study, felt it would be less biased and more fairly reported if public education campaign and media distribution was handled by LAEDC’s agency of record, MAYO Communications. Wal-Mart’s decision to release the study was based on the fact that its results had more pros than cons as far as the economic impact on California’s economy was concerned. Previously the communities were not well informed on the issues and much of the media coverage was unbalanced and negative toward Wal-Mart. Wal-Mart, LAEDC and MAYO agreed that there was a better chance of getting out a balanced perspective on the true impacts of Supercenters coming to California if LAEDC and MAYO educated the public through the media.

Target Audiences: Our primary audience was the print, TV and radio media in Southern California and the local public. Our secondary audience was the skeptical labor groups, California mayors, especially the mayor of Los Angeles, and other community and anti-Wal-Mart groups.

Implementation: “Wal-Mart” had already become an emotional word in the media and public, accused of eliminating jobs and busting unions with lower wages. On our recommendation, after LAEDC completed the study, Wal-Mart decided that LAEDC’s PR firm, MAYO Communications, should release the study findings as the firm always does with the corporation’s other studies. LAEDC has a reputation of being neutral, credible and consistently delivering accurate and useful data to the media and public. Additionally, Chief Economist and Vice President Jack Kyser, LAEDC, has a good image and reputation with the media. Director (now Vice President) Greg Freeman, Public Policy, LAEDC, who authored the Wal-Mart study with a team of economists, including Kyser, went over it with a fine-toothed comb. We pounded out Wal-Mart talking points and counseled them on the media.

MAYO received word that the labor unions were trying to get a hold of the study to hold their own news conference criticizing it before its release. MAYO decided to work out of the box – instead of going the usual route of allowing the media to review the 42-page study in advance, we decided to release it the morning of January 27, 2004, at a news conference at LAEDC headquarters in order to control message points and minimize the affects of any negative predispositions against Wal-Mart.

To allow the media access to Greg Freeman and any of the team of economists, we held a news conference and remained available to answer questions and provide Wal-Mart contact information should questions about the company itself arise. Our strategy team agreed that we would only respond to questions surrounding our client’s study results, keeping news conference focused on the economic impact data and away from any anti Wal-Mart sentiment. As a further protective measure, we limited the news conference to credentialed media who RSVP’d for the event. This allowed us to eliminate the possibility of protestors or anti Wal-Mart hecklers. At the news conference we announced that there would be a short statement from study author Greg Freeman followed by a question and answer time, after which the media could sign up for one-on-one interviews with Freeman and other economists on hand.

Due to so many high profile stories occurring locally and nationally, not to mention the War on Terrorism and Iraq War, we decided to hire freelance photographer Rena Macure, who worked part time for the Associated Press, to help get images out to newspapers that could not attend but wanted a high resolution image. We were also competing with an ongoing grocery strike in Southern California, an issue that some might attempt to use negatively toward Wal-Mart since the company was also trying to sell groceries in their new Supercenters. We made sure that the media knew that the study was launched about a month before the labor dispute and strike even began. Also, we informed them that the study found that for every job lost due to a Supercenter’s arrival in a city, it created seven new ones and it could literally save each resident in California $500 a year in groceries because of its lower prices.

Budget: The budget for the entire campaign was $10,000, which included phone calls, faxes, printing, media kits, news advisories and news releases. It also included follow-up media calls and interviews after the news conference. We were under budget and there were no surprises or financial challenges.

Results: Only a handful of media called to reserve a spot at the news conference the night before, but by the time the news conference started we ran out of media kits for the standing room only crowd. The media, including Lou Dobbs, CNN, and Jeff Daniels, producer of CNBC, each wanted one-on-one interviews with study author Greg Freeman after the news conference. It was so busy that the other economists who reviewed and contributed to the study also did media interviews; sometimes there were three or four separate media interviews happening simultaneously in offices and suites throughout the building. The media interviews went longer than the one hour news conference.

Upon returning to the office numerous reporters and writers from publications all over California and the nation had called saying they wanted the study and an interview. Days after the event radio stations, including KCRW and KPCC, asked to have Greg Freeman on live to debate the issue of Wal-Mart developing in other cities throughout Southern California. Then when the first Supercenter opened in the Palm Springs, CA area, again the phone rang off the hook for reaction and comment. Media interest mushroomed and continued to have legs through May and June. The LAEDC study results continued to pop up nationally in other states when Wal-Mart pros and cons were debated, with study results being used in stories from the Wall Street Journal to Time Magazine.

Writers who covered the story found that most of the pros outweighed the cons in having 40 Supercenters locate in California. While Wal-Mart worried that labor union representatives and Wal-Mart opposition leaders would question and criticize the study, the only negative media comment came from the Los Angeles Times, which sent two reporters and was upset that they did not receive the study in advance. Our response was that Wal-Mart chose not to give the media an advance copy.

MAYO created such a positive statewide buzz with the campaign that it caught a lot of politicians, the opposition and the media off guard. The reason was that we chose not to hype the report, stating only that the Wal-Mart study was ready to be disclosed and there would be a news conference announcing its results. Six months later, MAYO continued to receive calls from the media asking for a copy of the study and Greg Freeman’s availability to comment on Wal-Mart issues in other cities, not only in California, but nationwide. Even though the LA Times was critical at first, the paper reported fairly in two more stories, covering both sides of the issue – which did not happen before. Its major competition, the Los Angeles Daily News, profiled our story on the front page of its business section.

Wal-Mart was so pleased with the results, they’ve asked LAEDC to do another study, but this time studying the economic impact on surrounding businesses in Southern California. Stay tuned.