Wal-Mart Dials 1-800-Contacts, Orders New Pair

1-800-Contacts, based in Draper, Utah, is teaming with corporate goliath Wal-Mart to offer consumers savings, improved convenience and better eye health. But it will still do its own ads.

"It's interesting," says 1-800 corporate spokesperson Kevin McCallum. "Our corporate cultures are very similar, but we have our own creative staff. We create the storyboard, write and shoot our own commercials--and that won't change."

According to McCallum, 1-800's marketing campaign includes TV, radio, direct mail, customer loyalty programs and what he calls "street fighting" (once known as guerrilla marketing), such as campus visits and grocery store placement near lens cleaning solutions, online, search engine, and affiliate and partnership portals. According to Nielsen Monitor-Plus, the company more than doubled its ad spend last year to $9.6 million through October, compared to $3.9 for all of 2006.

But the company, which has 650 employees, will work with Wal-Mart's marketing group, he tells Marketing Daily. "It'll be a cross between the big stuff with the New York agencies and our entrepreneurial stuff."



Clearly comfortable uniting with a company that annually hires 10,000 times the number of employees it has, McCallum says the deal is in its early stages and too new to have worked out the marketing details. The companies expect to integrate store, Web, and phone service this fall.

"We are two different companies that complement our core competencies," he says. "They have [3,000] stores and we have a major online presence as well as a 24/7 call center."

In a press release announcing the arrangement on Friday, the companies estimated it could save consumers $400 million on contact lenses over the next three years.

"By offering greater accessibility and savings on contact lenses, the alliance also aims to make it easier to replace lenses according to a schedule doctors recommend--a practice that may result in better eye health," the companies said, citing a 2004 Federal Trade Commission report that showed some consumers "over-wearing" lenses in order to save money and because they found it inconvenient to get new ones. The study states that "57% of consumers ... would replace their lenses more frequently if the lenses cost less."

1-800 was founded in 1995 by entrepreneurs. Sales have grown from $4 million in 1996 to $249 million in 2006, the last year for which sales are posted on its Web site. It "stocks more than 20 million contact lenses (the world's largest inventory) and delivers over 150,000 every day directly to customers."

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