Did WalMart Smile Too Much In Germany?

Posted by: Bruce Nussbaum on July 29, 2006

It’s fascinating to see so many reasons being given for the failure of WalMart in Germany and its retreat by selling all its 85 stores to a German competitor. You have “not enough stores” to have critical mass. You have “unions and higher wages.” You have “German government regulations.”

My favorite, however, is culture. In today’s NYT’s biz section, you have WalMart sending over American managers who wanted to bag groceries for German consumers. OOps, German consumers like to bag their own stuff. The same American managers told clerks to smile at customers—be friendly, just like in the old USA. But German customers like “brusque service” and were put off. WalMart is also selling it’s stores in South Korea. I wonder what it did there to its customers.

I’ve seen this kind of thing happen in Portland, OR or Boise Idaho when New Yorkers go out to buy something and are put off by friendly people behind the counter. It’s hilarious.

And it’s culture. You’ve got to know your customer’s culture to give your customer a great experience.

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Reader Comments

Steve Portigal

July 30, 2006 02:39 AM

My favorite New YorkPortland, OR environment is Kornblatt's Delicatessen on NW 23rd. It's kind of a Disneyfied version of NYC, of a Jewish deli. I haven't been in years, but I was struck by the brusque, pushy owner who was only pushy by PDX standards. The guy seemed to stick out like a sore thumb in Portland, obviously by design (because what city loves characters more than that one?) but in my earliest visits to Portland I was kinda hoping for a more authentic New York experience. I walked out of there thinking "that guy wouldn't last 10 minutes in NYC." Only upon reflection did it become clear that in fact it was an authentic PORTLAND experience because of the way it had shifted and drifted from its origins.

Adrian

July 30, 2006 03:20 AM

I'm sure there were a myriad of reasons that led to Wal-Mart’s final decision, but too much Americana doesn’t appear to go as far as it used to

Robert

July 31, 2006 02:07 PM

funny statement: "But German customers like "brusque service" and were put off"... do you really believe that stuff?

The real problems:
- Wal-Mart was not well known
- fierce competition among discounters like ALDI / Lidl (the leading discounters in Germany)
- wrong product portfolio
- and last but not least: Wal-Marts brand was not the very best in Germay due to ridiculous leadership methods (never ever try to educate employees by cheerleader style in Germany, thats simply stupid)

Alan, german translator

August 14, 2006 12:33 PM

While startuing business abroad you should learn cultural specific of the country. It's told at every MBA school.

thamane

August 17, 2006 04:39 PM

Being German myself I find it difficult to believe that my compatriots would be put off by a smile ... I find the stories that some German men might have misunderstood it as a come on more likely. But in the end it was maybe rather that German customers knew that the smile was imposed by management that put them off.

However, I personally liked Wal*mart, especially in the beginning. I did my everyday grocery shopping at Aldi's, because of price, quality (and also the "smart shopper" image the slightly trashy Aldi stores have, I guess ;-) - and only then, once or twice a week I'd go to Wal*mart to buy the stuff Aldi doesn't have, like a special brand of toothpaste, cat litter, pizza with salmon or whatever. In short, to me, Wal*mart was complementary. Somehow their basic stuff that was as cheap as Aldi's never seemed to be the same quality.

I then moved within the city and I never returned to Wal*mart because I was too lazy to take the car if I could do all my shopping by foot in an Aldi and a Globus store downtown (even if Wal*mart does have a large parking lot, my apartment didn't, so I would have gained nothing).

These days I returned to my old Wal*mart, just to have a look at it and was shocked. The old Walmart until 2001 had about 70% groceries and the rest was mostly household stuff, some tv sets, some bikes, even lawnmowers (we too have a tradition of superstores that sell lawnmowers and groceries in the same shop, like allkauf, like real and many more; I'd like to know thought that was uncommon in Germany ?) but mostly household. Now the groceries were about 30% and the selection seemed almost as limited as Aldi's. Instead they seemed to have reduced their shelf space and filled the rest with a very limited selection of almost any imaginable item.

Now, if I want to browse through books, I go to a real book store - there's a bunch of them. If I want to buy a printer I go to a place that sports more than two models (or I make sure before that the printer is exactly the one I want). If I want to buy a lego present for my little nephew, I go to a toy store that has more than two or three different boxes to choose from.

I mean, the thing that worked for me in the beginning was the variety on a limited number of goods. I knew if I wanted to buy lasagne pasta slices, pickled garlic and Cologne beer I knew where to go and I could pick up vacuum cleaner bags and letter envelopes, too. I knew even that they had some twenty TV sets and I could certainly get a new antenna cable there.

By offering a very limited choice of everything they just missed the point in my eyes. Its a shame, because I did like the store when I was living close.

BTW I never had somebody trying to bag my groceries. I wouldn't have liked it, but its not because somebody handles my groceries - that's pretty lame because how many employees had handled them im the store before? It's just that to me it would have seemed superflouous, I'd have felt invalid and I'd have felt compelled to tip the bag boy. Plus, I'd have known that I payed for that service by buying my goods, which would have made them seem less cheap ;-) But really, I wouldn't have cared too much.

John

August 18, 2006 04:23 PM

Reminds me of the 70s when I worked in Manhattan, around the corner from the Fifth Avenue store of one of the very expensive Italian handbag manufacturers. I visited a few times to buy gifts my boss was giving. What a riot! The place was staffed by fashionable, but barely literate, young women who treated the wealthy female clientele like second-class citizens. They'd bark at them or just ignore them, sharply tell them to wait their turns, and basically be impatient and unpleasant. To top it off the shop was closed from noon until one for their lunch. Didn't seem to hurt business, though. The customers meekly waited in line like the patrons of Seinfeld's Soup Nazi before handing over outrageous sums of money. Retail's a funny game, indeed.

Lizzie

April 12, 2007 11:28 AM

So cliché!... Do you old Americans prefer hypocritical smile of people who really don't give a damn about you? I mean not cashiers but shop managers... Do you truly believe those are nice smiles?

Well looking at the way you let your country be run that doesn't quite surprise me. People happily smile at you (see the L-guy in Wash.DC.?), and you conclude he or she is the best to you?

You probably think you should help foreigners be better thanks to your way of working, going to movies, shopping, loving or not...

Let's say we don't want European USA in here.

Rebecca

April 29, 2007 01:28 PM

That german consumer likes brusque service, is a cliché or wrong interpreted. Im from Germany, and I made with my class this service like in the US for the consumers. It was for our London trip. I just have to say: Some were really lucky to have somebody who pack there things into the bag. For the most people its unused so they show a different reaction.
Thats the only reason. In Germany its not normal to get this service at the cash box. Service in general is normal but not this service *lol*
It feels strange if somebody in the supermarket wants to actuate you like this.

You should try that in the whole country and everyone would get used to that, so there wouldnt be a "problem" anymore.
But if you dont know the reason, dont claim any stupid things which base on the clichés about germans. Make a survey or so.
In some other jobs its not unusual to say: smile if theres a customer or be friendly. Its just the way how you do it and if some people do it.

Beate Florence,Ms.

May 2, 2007 05:55 AM

I don't have any idea if what is sold in German Wal-Marts is the same as in My Wal-Mart. I am a German, living in America, and from my point of few, there is not enough quality in Wal-Mart. And German's are a picky bunch. I am a Wal-Mart cashiere, I agree about the long lines, I have customers who hunt me down, and don't mind waiting in line for me to be their Cashiere, I give them price reductions when I know about them, I love my customers, we laugh and dicuss, ggod sales and problems in Wal-Mart. The biggest rpoblem is management. They don't know a thing about human nature or ethnic differences. They are not educated in human nature. The money is to important, bodies count as far as cashiere's is concerned. Not personalties or wisdom. Dumb management. gute nacht Beate Heilig

Cristian Sandoval

August 25, 2007 05:45 PM

Walmarts issue was not the culture. Walmart has included their distributors as part of theyre business model. When they went to Germany, Fedex and UPS did not have the capabilities they have in all the countries where walmart has succeded.

John Cunningham

May 28, 2009 11:21 AM

well i heard they stocked bed-linen, pillow covers and such in US sizes which those living in Germany obviously had no use for which indicates a pretty poor product policy.

Also, rumours of how staff were encouraged to spy on each other and were forbidden from social contact outside the work-related arena (or, heaven forbid, romantic entanglements!) can't have helped.

by the way on the New York handbag store thing: those rich ladies were probably loving it and going "that's soooooo New York"!!

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