Walmart Goes For Style, Not Specs, In Headphones
By Lisa Johnston On Jun 7 2010 - 3:01am
NEW YORK — Walmart aims to cover almost all its bases
in accessories — just not the high-end ones.
Although product selection varied by location, our
walkthroughs showed an ample variety of CE accessories,
but a much less varied SKU set. With the exception
of flat-panel TV mounts, the selection of products
above the $99.99 mark was few and far between.
Walmart’s technique of handling accessories is
perhaps best exemplified by its headphones selection.
Our walkthroughs showed products
from many of the big players in
headphones — Philips, JVC, Sony and
Koss — but noticeably absent were
such higher-end names as Sennheiser,
Shure and Monster (although you can
find Sennheiser and Monster products
Colors played a prominent role in headphones and
earphones, with a vibrant array of JVC Gumy ($9) and
Marshmallow buds ($19) to pair with any possible color
MP3 player. Although extremely low-end models,
the multicolored ear buds were arranged prominently
and proved to be a striking display with no shortage
David Rubin, headphone product manager of Maxell,
told TWICE, “With the realignment of the CE department
and a renewed focus on the category, Walmart
has had a major positive impact on the headphone
category. The growth and success can be attributed
to a strategically selected assortment, which focuses
on popular price point models in a wide range of colors
Rubin added, “The realignment has allowed for increased
shelf space dedicated to the growing headphone
category. For continued growth, and in order
to keep the category fresh and exciting, it would be
benefi cial to add headphones with new on-trend colors,
different styles and unique functionality on a regular
While Walmart.com offered a pair of Sony over-ear
headphones for $349, the most high-end SKU we saw
in-store was a set of RCA wireless headphones for
$49.88 (although they weren’t in stock at the time).
Most of the manufacturers interviewed by TWICE
agreed that Walmart’s customer isn’t interested in the
above-$99 price point product.
“People who shop at Walmart are bargain hunters —
they’re not loyal, they’re just looking for the lowest price,”
said a product manager at a leading headphones
manufacturer. “We don’t find our
loyal users seeking our products. Our customers
don’t usually shop there for headphones.
But there are manufacturers whose
business model fits well — Skullcandy is a
good one. They spend a lot of time worrying
about design and color and packaging
[because they don’t affect the price as much].
Stephen Baker, industry analysis VP at The NPD
Group, concurred: “That’s not their customer. On occasion
they might be interested in testing those products.
In general, they haven’t gone over that $50 price
range. TV remotes come to mind as well — they’re very
successful with the entry levels, but when they go above
$50, that’s not a very good place to be. Accessories in
general — they tend to be pretty focused on the entrylevel
and not so much on the step-up.”
When asked if Walmart planned to expand into higherend
headphones (above the $50 mark), Kevin O’Connor,
Walmart CE VP, told TWICE, “We carry more expensive
headphones, over $50, today. The customer determines
what we should have in the stores. They want
great products, but at a value. If they determine that a
$99 item is a great value, they will purchase it.”
Its avoidance of the higher-end headphones is generally
seen as a wise strategy. High-end audio means
a need for an assisted sell to explain the technology —
something Walmart doesn’t participate in.
“They wouldn’t want to get into the higher-tiered pro
audio market,” said the headphones product manager.
“That just completely violates Walmart’s business
model. $300 headphones — those are things that sit on
the shelf for a while … The further upmarket you go, the
more you need to leverage an assisted sell. You need
to be able to provide a high product margin or you give
the seller a spiff.
“If Walmart wanted to get into pro audio, they would
need to educate their employees and offer some kind
of incentive program, which I know they would never
do because it completely goes against their business
model,” he added.
NPD’s Baker noted, “As they start to upgrade their
MP3 player market or TVs or [other core categories], I
think there’s opportunities to maybe try again in some
of those higher-priced points as they upgrade the entire