This holiday season, as you peruse the aisles of your local Walmart, you might come across a five-foot tall Nutcracker decoration. Over at Sam’s Club, the glint of a lab-grown diamond might catch your eye. And overseas, it might be wasabi macadamia nuts that find their way into your cart.
These products are but three small examples of the bets being placed by the chief merchants and top sourcing executive at Walmart Inc’s major divisions to win the highly competitive holiday season. These items didn’t just land on shelves randomly, of course.
They and the hundreds of thousands of other products on stores shelves and online, were chosen, often at least a year ago, by teams of buyers led by Latriece Watkins, chief merchant at Walmart U.S., the company’s biggest division at 69% of its $650 billion in sales; Megan Crozier, chief merchant at Sam’s Club, and Andrea Albright, whose responsibilities include serving as executive vice-president for sourcing, Walmart. That role puts her in charge of the worldwide team that works with suppliers and looks for new ones for the whole company. (Abroad, each market has its own chief merchant.)
“The chief merchant leads the personal shoppers of America,” says Watkins. There are 100,000 different individual items at a typical Walmart store (and countless more online), and Watkins’ teams work with vendors, influencers and lots of data to decide what makes it to store shelves and online. For the holiday season, the process begins a year in advance, including knowing how much more to order of an item that’s proving to be popular and getting a sense of the latest trend to jump on. That is the case with those Nutcrackers, items so popular that there are even Facebook groups to swap tips on decorating them.
While a successful holiday season takes a village—including COOs to make sure items move through a retailer’s system efficiently, CFOs to manage money in a healthy way, and CTOs to ensure the IT systems sing together—the chief merchant’s role is particularly important. After all, a retailer can’t make money if shoppers don’t like what is for sale there. While consumers have been pulling back on non-essential items (leading to soft sales at chains like Target, Macy’s and Kohl’s), Walmart has been handily outperforming those rivals this year. But to continue to do so, its merchants must make the right bets.
Personal shoppers by proxy
So what exactly does a CMO (not to be confused with a chief marketing officer) do? Those executives don’t choose every item of course. But they supervise large teams of buyers who do and enable those merchants, expected to be experts in their product category, to do their thing.
Sam’s Club’s Crozier cites as an example a general merchandise manager, or GMM in retail speak, named Spencer who has bought roses for the nearly 600-location warehouse retailer for the last seven years. His entire job is to buy roses, and to know all the minutiae about kinds of roses, sourcing and so on. One common request a few years ago among Sam’s customers, who need membership to shop there, was for its roses to be more fragrant. Spencer worked with seed manufacturers over a number of years to meet that customers need. “My job as chief merchant is to create an environment in which merchants can truly become experts and excel at their craft,” she says.
Crozier herself has been a buyer at Walmart’s namesake banner throughout a large part of her career, including a stint focused on buying Apple’s iPods. (She later was put in the cameras category, a job made harder by how Apple’s iPhone decimated camera sales.) She became a buyer for food for Walmart, and eventually got to Sam’s Club.
Watkins started her career as a lawyer, but says she was one of those kids who was constantly ringing up her stuffed animals at her toy cash register. Now, she also defers to her buyers’ expertise. “I’m the chief merchant, and I’ve got lots of ideas about what buyers should do,” she says. “But the buyers have a lot more ideas about how to bring the products to life. Brands do come to us, but our merchants are also looking at what customers want and the trends they see, and they are in the environment.” A CMO is akin to a conductor who gets his or her musicians to shine at their specific instrument and get the whole orchestra working together.
For Albright, whose team sources 300,000 kinds of items from suppliers in 120 countries, a successful merchant is one who is curious. “You’ve got an eye for what’s happening around you and seeing those customer trends, and there’s an element of understand people’s hopes, dreams and problems,” she says.
Albright’s team, which serves all three Walmart divisions, goes out in search of new and existing suppliers to meet the needs identified by the merchants, and then the team vets and onboards the those vendors. For Albright, Walmart is a family affair: her father worked for Walmart for decades (they missed each other by four years), and Albright has a framed photo of him with Walmart founder Sam Walton in her office.
Given the complexities of Walmart’s and Sam’s Club’s operations, most of what you see now in one of their stores (or, Sam’s case, “clubs”) has been decided on for a long time. But the retailer does leave itself some wiggle room for increasing a buy when an item is suddenly popular.
Sam’s Club’s Crozier says lab-grown diamonds are one such trend. A few months, Crozier had her team try to think of ways to enhance Sam’s Club’s jewelry assortment for the holidays. The retailer has a group of 50,000 members—a focus group on steroids—it consults regularly for insights. And offering lab-made diamonds, considered to have a lesser impact on the environment, kept coming up. Soon enough, Sam’s was selling the diamonds online and then at 100 of its clubs. “I like this idea of moving with speed, but it’s always calculated. Here we could do it because members had already given us their permission,” says Crozier.
For all three executives, there’s reason to believe their positions have a career growth trajectory: Costco Wholesale CEO Ron Vachris is a former CMO, as is departing Michaels CEO and incoming Kohl’s CEO (as well as Walmart alum) Ashley Buchanan, while Walmart Inc CEO Doug McMillon and Walmart U.S. CEO John Furner were also senior merchants earlier in their careers.
