Retail giant Wal-Mart working on its image

Ask Jim Groh about working at Wal-Mart Stores Inc., and he starts talking about people who've climbed the ladder at the world's largest retailer.

"I can come up with 10 success stories for every failure that comes out in the media," said the manager of the just-opened Wal-Mart in Sacramento's Country Club Centre.

The company also has announced plans to build a 210,212 square foot Wal-Mart Supercenter in Lodi at the southwest corner of Lower Sacramento Road and Kettleman Lane, but its fate rests with a November ballot measure which, if passed, would limit retail outlets in the city to no more than 125,000 square feet without subsequent voter approval.

Additionally, it has been reported that Wal-Mart is contemplating building a store in Galt, but company officials have refused to confirm it.

Accused of paying miserable wages and benefits, discriminating against women and even hiring illegal immigrants, Wal-Mart is trying to mend its image. It's running TV ads touting its charity work and its treatment of employees. It's directing store managers like Groh to send out press releases and chat up the local media to announce grand openings.

"I know the inner workings of the company," Groh said when asked about the retailer's reputation. "I know Wal-Mart's got a lot to offer."

Groh said community outreach is nothing new and that he's been immersing himself in chambers of commerce and local charities his whole career.

"Wal-Mart has been very much focused on community involvement as long as I've been here," he said.

But Sarah Clark, a spokeswoman at the company's Arkansas headquarters, said Wal-Mart is taking a more proactive approach to public relations these days, attempting to explain "who we are as opposed to allowing others to define who we are."

She said the public relations campaign isn't a response to a specific charge against the company. But it was influenced by a 2002 public opinion survey, taken at Wal-Mart's behest, that suggested the company was developing a negative reputation. Among other things, people believed "we offered only part-time, dead-end jobs," Clark said.

"We needed to tell our story more, share the facts about the career opportunities we have in the company," she added.

The result is a multipronged effort, ranging from store-manager press releases to sponsorship of National Public Radio -- the latter a clear effort to reach an influential audience not normally sympathetic to Wal-Mart.

The centerpiece is a series of TV ads that began airing nationally last year. In one, a Wal-Mart employee explains how Wal-Mart paid for expensive liver operations for his young son.

"I don't think people know how great the benefits are at Wal-Mart," he adds.

Wal-Mart's critics find a direct tie between the public relations effort and the company's various controversies.

"Their advertising seems to be completely driven by the (negative) press they're getting," said Brad Seligman, an attorney with the Impact Fund, a Berkeley-based legal foundation that's pursuing a class-action sex-discrimination case against Wal-Mart. "Their advertising is very strategic."

The case, pending in U.S. District Court in San Francisco, accuses Wal-Mart of depriving about 1.6 million female employees of equal pay and promotions.

The suit is the latest in a series of public relations messes facing Wal-Mart. Labor unions and some Democratic politicians have pilloried the company, saying it pays substandard wages and health benefits -- and forces rivals to do the same. Some community activists say Wal-Mart destroys mom-and-pop competitors and hollows out downtowns by drawing shoppers away. Last year the U.S. government began investigating whether Wal-Mart employs illegal immigrants.

Regardless of motivation, Wal-Mart has little choice but to improve its image, said retailing consultant Kurt Barnard. Although the retailer remains enormously popular with shoppers -- its latest quarterly report showed record sales and profits -- Barnard said the negative publicity could eventually drive them away.

"This could have adverse consequences, not in the near term, but over the long haul," said Barnard, who runs a New Jersey firm called Barnard's Retail Consulting Group. "Nobody would want to be associated with Wal-Mart, including shoppers."

As far as reputation goes, Wal-Mart's biggest fight seems to be in California. With 181 stores in this state -- a paltry number by Wal-Mart standards, given the state's population -- the company is making a big expansion push. Yet in many cities, it runs into opposition from anti-sprawl activists, local merchants and labor leaders angered by Wal-Mart's anti-union stance. Wal-Mart sometimes has had to fight at the ballot box to get stores approved.

The introduction of Wal-Mart Supercenters -- combination department stores and supermarkets -- has only intensified things. Rival supermarket chains cited the low-price Wal-Mart threat to obtain concessions from union workers in Southern California, but not before a devastating strike that cost the grocers hundreds of millions of dollars in profits. California's first Supercenter opened in March in La Quinta, near Palm Springs.

The Supercenter factor is looming over grocery contract negotiations in the Sacramento area as well. The second California Supercenter is scheduled to open this fall in Stockton.

Sacramento's newest Wal-Mart, the seventh in the area, opened with relatively little controversy. Elected officials like county Supervisor Muriel Johnson were at the grand opening. The company took over an abandoned Montgomery Ward site in a shopping center that had seen better days. The opening years earlier of a Sam's Club, a subsidiary of Wal-Mart, had helped, but the Wal-Mart could give the center and surrounding neighborhood a much-needed boost.

"It brings more people down to Watt Avenue," said Dottie Montana, general manager of nearby Country Club Plaza. "Once they've shopped there, they can cross the street and shop us, and vice versa."

Wal-Mart has gone out of its way to show its corporate citizenship in Sacramento. Groh said three-fourths of his 365 employees (out of 2,000 applicants) are full-timers. The average hourly employee is making $9.95 an hour, or 31 cents an hour more than the Wal-Mart nationwide average.

Groh had never set foot in a Wal-Mart when he was recruited by the company out of California State University, Fresno, in 1992. (The company had been open in California only two years.) But the Sonora native had studied the company's management strategies and jumped at a chance to join Wal-Mart's management trainee program at a store in Oroville.

From there he worked in managerial slots in various cities and was running an Anchorage, Alaska, store when he was appointed to run the new Sacramento location.

A two-story Wal-Mart, the fifth in the entire company, the facility sports special escalators for moving shopping carts between floors. A cluster of balloons formed an archway over the main entrance Wednesday.

The place was packed.

"I love Wal-Mart -just the prices that they have, the selections they have," said shopper Diane Gomez of North Highlands as she loaded her car with goods.

Though she said she's vaguely aware of the controversies surrounding Wal-Mart, she said she's still loyal to the company.

"If you have a store that puts out good deals, that's where I'm going to shop," she said.

At the grand opening, the company announced grants totaling $17,750 to Sacramento-area organizations like Women Escaping a Violent Environment.

Nicolette Bautista, WEAVE's executive director, said she's troubled by controversies such as the sex-discrimination allegations, but said the issue of pay inequality transcends Wal-Mart.

And she noted that Wal-Mart has donated more than $19,000 to WEAVE over the years.

"It's pretty standard that when they have a grand opening, they give us a gift," she said. "It's wonderful."

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