WMT Walmart Inc

By Sarah Nassauer 

Wal-Mart Stores Inc. wants chief executive Doug McMillon to do more than boost sales: it is leaning on the CEO to burnish its image.

More CEOs are raising their public profiles, speaking out on issues and appearing in ad campaigns, but it remains an unusual move for the world's largest retailer. In what is believed to be a first, Wal-Mart cast a CEO in a commercial that aired on social media and television for about three months through the end of September. The ad, starring Mr. McMillon, touts the company's commitment to employees, not the latest deals.

Putting top executives in advertisements can build credibility for companies and rally staff, but it can be risky--highly paid executives may garner little sympathy, and some lack the charisma for the job. In cases where the CEO is central to the brand, as with ousted Men's Wearhouse founder George Zimmer, the company can be left scrambling after that leader leaves.

Mr. McMillon's 30-second spot is part of a wider push by the retailer to shed perceptions that it offers little more than low prices and low-paying jobs, labels that have long dogged the company.

"I'm Doug," he says in the ad, surrounded by produce in one of the company's stores near its Bentonville, Ark. headquarters, flipping through photos of employees on his Instagram account. "Here at Wal-Mart we are committed to taking care of the people that take care of you," he tells viewers.

The ad ran this summer during "Fox and Friends," George Lopez and SportsCenter, as well as on Facebook and Instagram. Wal-Mart declined to say how much the ad campaign cost.

Dan Bartlett, Wal-Mart's vice president of corporate affairs, conceived of the campaign with his team, say people familiar with the process. The "reputational ad" highlights Wal-Mart's promise to invest $2.7 billion in higher wages and employee training.

An "associate CEO" who started his career in a Wal-Mart warehouse in 1984, Mr. McMillon is a natural to deliver a message aimed at employees and policy makers, Mr. Bartlett said. As CEO since February 2014, Mr. McMillon has raised store employee wages and is building hundreds of management-training academies.

Executive pitchmen came into vogue after Chrysler ran memorable ads in the 1980s featuring CEO Lee Iacocca asking shoppers to give the embattled brand another chance. Some companies such as Papa John's International Inc. featured its CEO in nearly every ad; Apple Inc. recently nodded to its rabid fans by casting Senior Vice President Eddy Cue and other executives alongside late-night host James Corden in an Apple Music TV commercial.

Nonetheless, most executives have preferred to remain in the background, unwilling to appear publicity-hungry or risk drawing negative attention to themselves, according to Leslie Gaines-Ross, chief reputation strategist at communications firm Weber Shandwick. In the age of hyper-sharing on social media, "everything is different," she said.

Mr. McMillon's actions on wages and his consistent focus on employees make him a plausible pitchman, Ms. Gaines-Ross said. The 49-year-old year old executive appears younger, "not some CEO of the 50th floor who never talks to employees," she added.

CEOs generally appear in ads for two reasons: to build credibility or to acknowledge a mistake, says Pradeep Chintagunta, a professor of marketing at the University of Chicago Booth School of Business. In a 2010 Domino's Pizza Inc. ad, President Patrick Doyle discussed customer complaints about artificial-tasting pizza with cardboard-like crust and vowed to improve its food. Many customers appreciated his candor, Mr. Chintagunta said.

Wal-Mart founder Sam Walton famously believed that his company didn't need to court elites. But as the retailer grew to the world's largest company by revenue, scrutiny on its dealings intensified and leaders changed tack. Mr. McMillon in particular has embraced a public profile, posting often to his Facebook and Instagram accounts.

It is unlikely that Mr. McMillon's ad changed many viewers' minds, says Peter Daboll, chief executive of Ace Metrix, a firm that measures the impact of video advertising and doesn't work with Wal-Mart. "You have a lot of people who are sensitive to Wal-Mart and labor issues that just didn't buy into this guy," questioning his high salary in survey comments, he says. Ace Metrix, which tested the Wal-Mart ad, surveys 500 viewers for each ad tested. (Including stock awards, Mr. McMillon earned $19.8 million in fiscal year 2016 which ended Jan. 31, 2016.)

Wal-Mart always will have critics, but employees and policy leaders responded well to the ads, according to Mr. Bartlett. They liked that "the CEO is going on a TV and saying it's a priority," to support workers, he said, adding that the company has no plans to put Mr. McMillon in future ads.

Google searches for 'Wal-Mart CEO salary,' spiked during the summer when the commercial aired to the highest levels since Mr. McMillon was announced as chief executive. Searches for 'Wal-Mart CEO' and 'Doug McMillon' also rose. He gained about 10,000 followers on his Instagram account, where commenters call him "commercial guy."

One commenter who posted about being fired from a store was surprised when the CEO acknowledged her note. "Oh Lord I never in a million years thought you would answer me," she wrote.

(END) Dow Jones Newswires

October 18, 2016 05:44 ET (09:44 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.