The Battle of the Compañeros

A highly calculated protest campaign and a Michael Moore-style documentary are aimed at bringing retail giant Wal-Mart to its knees by highlighting its rotten working conditions. But the company is fighting back with the kind of PR tricks usually reserved for American election campaign trail.

New York -- You've gotta love Wal-Mart. The enormous range: everything from apples to Zingers by way of bikes, guns and frozen cheesecake. The low prices. The logistical muscle, thanks to which victims of Hurricane Katrina were offered food, supplies, emergency generators and a cheery helping hand long before state aid arrived. Then, of course, there are the figures: 3,800 branches in the United States, 1,700 more worldwide, including 88 "supercenters" in Germany. More than 138 million customers can't be wrong.

Or can they? Robert Greenwald thinks so. The California-based documentary filmmaker famed for "Outfoxed," his cinematic broadside against Rupert Murdoch's cable TV channel Fox News, is taking the retail giant to task.

"Wal-Mart: The High Cost of Low Price," his 97-minute cinematic indictment à la Michael Moore originally screened in New York and Los Angeles and went into wider release across the rest of the country on Friday. In the film, Greenwald reproaches the multibillion dollar company for a catalogue of sins as long as the country's regal canyons: deserted small towns, ruined small businesses, rotten working conditions. "And for the most part," explains one shop assistant bitterly, "they do it all with a smile."

Greenwald's cinematic attack is, at least to date, the pinnacle of a new and powerful PR campaign against Wal-Mart. It's a multimedia attack that is being carried out on all fronts: TV-spots, full-page adverts in USA Today, the most widely read US newspaper, Internet ads and a protest tour taking in 84 large cities across the country. "America will be shocked," said Paul Blank, the director of Wake Up Wal-Mart, which is leading the campaign by the UFCW grocers' union against the multinational discounter.

The debate over Wal-Mart is almost as old as the trading empire itself. But the degree to which feelings on the issue have heated up in recent times, and how much is now at stake became clear two weeks ago at the premiere of Greenwald's film in a cinema located on New York's Union Square, the trade unions' old stomping ground.

"This isn't just the premiere of a movie," said Andy Stern, the president of the SEIU retailers' union, the biggest representative of employees across North America. "It's the premiere of a movement." That idea was sensed too, by the suspected Wal-Mart spy in the audience, who Greenwald promptly showed the door. And the reason? The man was spotted allegedly trying to record the film on his mobile phone. "Get lost!" the director roared after him.

The bluntly partisan flick, financed by almost $2 million worth of anonymous donations, marks a shift in the strategy of those fighting against Wal-Mart. It is not simply that this is the most costly campaign aimed at a US firm. Uniquely, the company's critics are using the Internet to coordinate their efforts into a mass protest.

Little wonder -- the men behind the campaign are masters at manipulating the media. The TV ads are the brainchild of Joe Trippi, former campaign manager for erstwhile Democratic presidential candidate Howard Dean. Wake Up Wal-Mart chief Blank was Dean's political director and campaign spokesman Chris Kofinis served as a member of presidential candidate Wesley Clark's team.

These are bad times for Wal-Mart, the company which employs more people than the US army and prides itself on the fact it sells shotguns but won't stock smutty magazines. All summer, the mood has been turning against the retailer. Tens of thousands of Americans heeded the call to boycott stores. Democratic senators took a stand against Wal-Mart's poor health and social benefits for workers. On top of this there were class actions and other court cases over alleged discrimination against minorities and women, withholding of overtime pay and the employment of illegal immigrants.

At the end of October, a leaked internal Wal-Mart memo did the rounds, in which management complained about the high costs of healthcare and suggested that the problem could be resolved by "discouraging unhealthy people from working for the company".

All this is damaging business. Wal-Mart shares have tumbled 30 percent from their high-water mark five years ago. Turnover is still astronomical, of course, but it isn't rising as quickly as it did back in those less critical days. Citizens' protests outside stores in New York, Chicago and Los Angeles hit takings. A McKinsey study found loyal customers were deserting the company because of all the negative publicity.

Wal-Mart has been forced to take the bull by the horns and defend itself. Part of the company's gigantic profits -- $2.8 billion in the last quarter alone -- have been ploughed back into its very own "war room," which is aimed at improving the company's image. And just as the company's critics have done, executives at Wal-Mart's Arkansas headquarters have enlisted the help of a team of top political consultants.

The specially selected spin doctors have one aim: to launch a powerful PR offensive. The so-called "Rapid Response PR Team" counts veterans of several election campaigns among its number. Those in the service of the mega-company include Ronald Regan's old advisor Michael Deaver, Leslie Dach, formerly a member of Bill Clinton's team, Terry Nelson (likewise on George W. Bush's staff), and Jonathan Adashek, once an advisor to John Kerry. Even the vocabulary they use is that of electioneering -- they talk of customers as "swing voters" and "true believers."

For the conservative company, this is a revolution: in his day, the tight-fisted founder of Wal-Mart, Sam Walton, detested spending money on advertising, seeing it as a waste of time.

With the release of Greenwald's film, the Wal-Mart troops are facing their first acid test. The PR warhorses' Web sites have already begun churning out elegies camouflaged as blogs ("I am very proud of my store") and hurricane updates featuring a host of photographs and statistics. At the same time, they are bombarding journalists with interview opportunities to prove their claims of Greenwald's "three mistakes in three minutes."

For the Christmas ad campaigns, they are sparing no expense to bring in top-notch stars -- musicians like Destiny's Child, Garth Brooks and Queen Latifah.

Meanwhile eloquent ambassadors for the company have been sent out to cinemas to debate the case with critics at screenings. But not all of them have been successful. Witness the case of Wal-Mart director Mia Masten in New York, who nervously argued against the film despite the fact that she hadn't, unfortunately, managed to see it yet.

But according to some observers the problem lies not just with Wal-Mart. "Wal-Mart has largely played by the rules that society has set out for it," business columnist Joseph Nocera wrote in the New York Times. In other words: low prices and high shareholder value come first, and everything else is a low priority. "Do we really want to change Wal-Mart?" asks Nocera, offering his own answer: "If the answer truly is yes, then we need to change ourselves first."