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As other retailers struggle, Wal-Mart steps up its game

Wal-Mart has expanded its electronics selection as part of its aggressive “Project Impact,’’ remodeling stores like the Supercenter in Raynham. Wal-Mart has expanded its electronics selection as part of its aggressive “Project Impact,’’ remodeling stores like the Supercenter in Raynham. (Michele McDonald for The Boston Globe)
By Jenn Abelson
Globe Staff / November 1, 2009

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RAYNHAM - Head to the back of the Wal-Mart Supercenter in Raynham and you may be in for a surprise.

Here, about 50 flat-screen televisions hang from the wall, a 60 percent increase in recent months. Trained sales staff approach customers about their electronics needs and offer home installation and consultation services for computers and entertainment systems. It all feels very much like Tweeter or Circuit City, two of the major electronics chains that shuttered over the past year.

While other merchants have gone bankrupt or struggled to survive during this recession, Wal-Mart Stores Inc. is growing its empire and capitalizing on the holes left behind. The discounter behemoth has embarked on an aggressive remodeling effort known as “Project Impact’’ that focuses on an easier shopping experience and an expanded selection of products in electronics, home goods, and fresh foods.

“There’s an opportunity for growth in these areas - it’s a trend we’re seeing in the stores due in part to the challenging economic times,’’ said Wal-Mart spokesman Steven Restivo.

A dozen of the 50 Wal-Mart stores in Massachusetts, including the one in Raynham, are among the retailer’s shops nationwide that will be remodeled by the end of the year. Retail analysts say the emphasis on electronics and home goods makes sense with the departure of major chains such as Circuit City and Linens ’N Things, as well as consumers’ increased focus on value. Wal-Mart has added upscale cookware lines from celebrities like Southern-cooking celebrity Paula Deen and created boutiques within the home department to feature merchandise out of the box.

“While other retailers struggle, their business model enables them to take advantage and build market share,’’ said Madison Riley, a retail analyst with Kurt Salmon Associates, a consultancy in Boston. “Wal-Mart is being aggressive in these challenging economic times, as they should. Consumers’ behavior has changed - they shop for value more now than ever before and Wal-Mart’s position is perfectly suited to this new consumer demand.’’

Some retail analysts say Wal-Mart’s new approach is an effort to appeal to more upscale consumers and undermine cheap chic rival Target. In August, US Wal-Mart stores saw traffic increase 1.3 percent from a year ago while Target saw traffic decline 2.6 percent from the year before.

The change is most apparent in the electronics section in the Raynham store, which has doubled in size since the makeover this summer. The shelves are lower so it’s easier for staff to spot customers in need and for shoppers to reach merchandise. The department now features an entire wall display of Blu-ray DVDs, with about 100 titles, up from 30 movies earlier this year.

Raynham store manager Bert Cabral, who noted that his shop is the busiest in Massachusetts, also talked about hiring a manager from one of the big electronics chains to help improve Wal-Mart’s customer service efforts.

“They give a whole new perspective and improve our approach to customers to provide more aggressive hospitality,’’ Cabral said. “We feel we can be more competitive in these areas.’’

Retail analysts say the longer the economic recovery takes, the more success Wal-Mart will have holding its core customer base and expanding beyond it. In some cases, this shift could make it more difficult for other, smaller merchants to survive.

Wal-Mart is banking on more frequent visits from shoppers by offering a larger selection of beer, wine, bread, fresh-cut fruits, and other groceries, along with a larger pharmacy area with more privacy for consultations.

Everywhere shoppers turn in the Raynham store, they are reminded of value with big new signs emblazoned with “Unbeatable Prices.’’ At the same time, the chain has reduced overall inventory by at least 6 percent to make the store less cluttered and address reduced consumer spending. Cabral says the new strategy is working, with sales up 5 percent since the store redesign this summer.

Cecelia Peterson, who previously bought her electronics at Circuit City in Plymouth, is now shopping at the Wal-Mart in Raynham for her DVDs and prepaid cellphones. She also started doing more food shopping here since the store increased its selection.

“The prices are just good here. You can’t beat them,’’ Peterson said.

Jenn Abelson can be reached at abelson@globe.com.