New York
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Walmart’s run as America’s largest retailer appeared to be in jeopardy when Doug McMillon became Walmart’s chief executive 11 years ago.
Walmart’s business was struggling, its public image was reeling from a bribery scandal in Mexico that reached top leaders, and protesters rallied outside stores nationwide over low pay and working conditions. “Walmart is falling apart before our eyes,” one analyst said.
But today, Walmart has never been stronger. The company’s stock recently hit all-time highs. Sales are surging, even as rivals such as Target, Home Depot and others slump. And Walmart raised wages and expanded benefits, becoming a business school case study on employee retention.
Much of that is thanks to McMillon, who announced Friday that he’s retiring soon as CEO. He oversaw Walmart’s transformation from a brick-and-mortar discount superstore that largely appealed to lower-income Americans to an everything store, everywhere for everyone.
McMillon, a Walmart lifer who took the top job at 47 as the company’s youngest CEO since founder Sam Walton, reinvented Walmart by threading one of the thinnest needles in retail: reaching new shoppers online while retaining old customers in stores. Walmart under McMillon used its unparalleled size to press suppliers into keeping prices ultra-low, all while adding new higher-end brands and growing online to attract a wealthier clientele.
And McMillon accomplished this pivot while navigating contentious political and social issues in America that have engulfed many companies, such as Target and Bud Light.
McMillon’s successor, veteran Walmart leader John Furner, will have to handle these challenges, as well as pressure from President Donald Trump’s tariffs and an uncertain future of shopping with AI. Walmart recently said it’s partnering with OpenAI to let users browse and make purchases directly through chatbot ChatGPT.
Low and middle-income shoppers historically formed the customer base of Walmart’s superstores in rural and suburban America.
But Walmart has increasingly drawn higher-income customers in recent years. Shoppers making more than $100,000 a year have fueled Walmart’s growth in recent years.
Walmart’s grocery business has underpinned its success. More than half of Walmart’s sales come from groceries, and the company has used its size and scale to muscle down prices and invest in improving its meat and produce aisles. That has benefitted Walmart throughout McMillion’s tenure, particularly during the post-pandemic inflation crisis that sent America searching for value that Walmart could help deliver.
At the same time, Walmart under McMillon has built a strong e-commerce business to compete with Amazon and draw shoppers online. It has added the option to buy online and pickup in store to thousands of its locations and Walmart+, a same-day grocery delivery membership.
Although Amazon leads e-commerce sales in the United States by a wide margin, accounting for 40.6% of sales, Walmart comes in second with 9.4%, according to market research firm eMarketer.
“The most notable change during McMillon’s tenure has been Walmart’s evolution into a major e-commerce company,” said RJ Hottovy, an analyst at Placer.ai.
McMillon also has deftly steered Walmart through political culture wars on guns, LGBTQ rights, immigration, the Confederate flag and other issues.
Walmart, historically a conservative company based in deep-red Arkansas, appeals to a wide swath of America.
It has worked carefully to stake out positions in the political middle to avoid offending customers and employees, and taken a slow, gradual approach to changing policies such as gun and ammunition sales. Dan Bartlett, the former communications director for President George W. Bush, has helped shape Walmart’s do-no-harm public affairs strategy.
“Politics moves around,” McMillon said in a 2017 interview. “We are on our 11th administration, since Walmart was born. There will be a 12th. There will be a 13th.”
