Wal-Mart is a study in contrasts.

Its low prices are awesome. Its shopping experience, not so much. Its positioning is terrific, but its advertising leaves something to be desired. It serves well its paycheck-to-paycheck customers, but panders too much to the politically correct.

Wal-Mart has a rock-solid heritage in founder Sam Walton, but too often loses sight of what makes it special.  The latest example came in the form of an announcement last week that the company was cutting prices on some 10,000 items. With any other retailer that would be cause for celebration, but with Wal-Mart it’s just disappointing.

Wal-Mart = Low Prices. Period. Not margins. Not promotions. Not rollbacks. If prices are always as low as possible—as Wal-Mart has worked so hard for so long to convince us of—how then can they be cut, especially across such a wide swath of products? In one of its “rollback” TV commercials, “Mike the truck driver” says, “just by driving smarter routes and making sure our trailers are packed fuller, we save millions of dollars on fuel costs.” Does the world’s leanest company expect us to believe that it just figured that one out?

In an April 9 story about the price cuts, the Wall Street Journal’s Miguel Bustillo and Timothy W. Martin cited a J.P. Morgan analyst whose regular Wal-Mart price survey resulted in a bill 2.3% higher than it was in the previous month. That’s a pretty big jump. While it’s any company’s prerogative to raise or lower its prices, Bustillo and Martin wondered  “…whether Wal-Mart is committed to pushing the envelope on pricing as it did in the days of its late founder, Sam Walton, or is merely hyping promotions as it pursues a  more margin-driven approach…”.

Judging from what Wal-Mart CMO Stephen Quinn said of the cuts, it appears to be the latter: “We felt we needed to increase the intensity and excitement with our customer, especially the feeling that Wal-Mart has great deals.”

Yuck. “Great deals,” “hyping promotions” and “a more margin driven approach” are what you’d expect from Kroger or Macy’s, not Wal-Mart.  I don’t know about you, but I expect the “great deals” at Wal-Mart to be baked into its everyday low prices, not used as underpinnings of a grand promotion.

Like many companies trying to cope with slowing sales, Wal-Mart can be its own worst enemy. Instead of fiddling with margins and flirting with upscale customers, Wal-Mart should aggressively tout its all-the-time, every-day, low-low-lowest prices. Always. It’s the one company with the credibility to do so, and promotions like this threaten that very crediblity. Wal-Mart needs its customers to believe that it always—always—gives them the lowest prices it can.

That’s what made Wal-Mart Wal-Mart. It shouldn’t mess with success.

This little illustration is from the January 29, 1954 issue of the Cass City (Michigan) Chronicle. Fifty-six years old it may be, but it’s a good reminder that the times in which we’re living are not so special after all. Businesses throughout history have had to cope with rainy days.

While the tools of advertising continually change, the need for it never does. That’s a lesson I learned the hard way through my own company’s stall (which began the journey that ultimately resulted in When Growth Stalls). Consistency is just one of the principles critical to recovering from (or preventing) a stall.

My business partners and I took our own medicine in 2009, and our firm is the better for it now. We’ll continue to keep it up this year, sluggish though the economy may be. I hope your company will too.

The last days of 2009 will bring a flood of provocative predictions about how radically the world of advertising and marketing will change in 2010. Statements like these–

Push marketing will no longer work

The era of conspicuous consumption is over

Interruption marketing is a thing of the past

–and endless variations of them will be in abundant supply as self-styled pundits, prophets and provocateurs try to grab their fifteen minutes (or 140 characters) of fame. To them I say one thing: dial it back a little.

New technology is enabling unique, intriguing, and thought-provoking avenues by which relationships can be enhanced (or harmed), and it’s doing so at a rapid pace. But branding never has been about one-way communication. It has always been a game of engagement. The tools may change, but the rules never will. And turning a page on the calendar has nothing to do with it.

Will the state of the art in branding be different in 2010 than it was in 2009? Yes, just as ’09 was different from ’08, ’08 was different from ’07, and so on, all the way back to the 19th century (and arguably beyond). The art of marketing continually evolves.

Beware the breathless predictions. People who overstate the change have something in common with old fashioned snake oil salesmen. In that respect, some things never change.

Last week, I wrote a BusinessWeek.com column entitled, “Why Your Advertising Isn’t Working.” Last weekend, GM launched its “Satisfaction Guaranteed” marketing campaign. With uncanny timing, GM’s new effort embodies many of the reasons I identified as to why advertising underperforms. (Judge for yourself here.) And for a number of reasons, GM’s campaign just doesn’t sit right with me.

First, in its news release introducing the effort, the company said, “if consumers give us a fair chance and look at the facts…our vehicles are the best choices.” The premise on which this statement seems to be based is odd to me, as if GM (recipient of billions of bailout dollars) has somehow been wronged by the public. Last I checked, people buy those vehicles which in their estimation meet their unique needs the best. “Fairness” (whatever that means) never even enters into the equation.

Second, GM went on to say it understands that to encourage prospective customers to give its brands a second look it will need to “work very hard to get people’s attention.” Fair enough, but the company didn’t work very hard to get people’s attention with this advertising. It’s flat, it’s boring, and (despite GMs protestations to the contrary) it’s been done before (see Chrysler/Lee Iacocca, circa 1981).

Third, I’m not sure a 60-day money back guarantee is the right strategy to reach people who have historically turned their noses up at GM brands. The question is less about how the company’s vehicles hold up in the first 60 days, but how they perform after 60,000 miles. I suspect this new offer will appeal strongly to GM fans, but won’t do much to move the needle among the buyers GM really needs to convert (who are currently loyal to dependable foreign makes).

If GM wants the public to give its vehicles a good second look, it must begin with a foundation not only of well-designed, well-built cars, but well-designed, well-built marketing. The fact that it didn’t shows a lack of understanding not only about how branding works, but how auto buyers think. Neither of which is a good sign.

One of the questions I’m frequently asked by corporate leaders struggling to manage in the current environment is how far to go with their cost-cutting measures. With their companies suffering sales declines, they’ve got to trim somewhere to maintain profitability (and in some cases to stay afloat), but they don’t want to cut the wrong things.

Recent moves by Jean-Paul Agon, CEO of L’Oreal, offer a good example. The luxury cosmetics maker has had a difficult year so far, in part because it “scrimped” on brand promotion, reports the Wall Street Journal. In light of this Agon knew he had to cut back, but he has done so wisely. He launched a reorganization plan which included a hiring freeze. He trimmed travel expenses and even closed three factories. What Agon did not do was cut off the company’s lifeblood, marketing and R&D.;

Says Agon, “We’re strengthening our media and promotion. It’s a brave strategy because when you face a crisis, most companies say I’m going to reduce my media budget. We decided to do just the opposite.” When it comes to R&D;, Agon is even more resolute: “The last thing to do would be to give up innovation because cosmetics is really about permanently inventing new products, new technologies, new benefits, new results.”

There is no cookie cutter answer for how a struggling company should cut back to make its numbers work. But when you’re faced with those difficult decisions, do your best to trim expenses and leave the investments in place.

Yesterday JetBlue launched a campaign headlined “Welcome Bigwigs” anchored by a special landing page on its website. The airline, like airplane manufacturer Cessna (see post below), is seizing an opportunity to make an attention-getting statement tied to the notoriety private jets (and their well-heeled passengers) have been getting of late in Congress and the press.

Air travel and a bold tone are about all the JetBlue and Cessna campaigns have in common, however. Both companies are taking risks with their campaigns, but whereas Cessna’s effort is bold, JetBlue’s can best be described as brash. The airline’s overtly tongue-in-cheek approach just doesn’t feel right.

Ostensibly addressing “Hedge Fund Managers…Captains of Industry…Former Treasuries Secretaries…Owners of $35,000 Antique Commodes…” (you get the idea), JetBlue is making a point by making fun of easy targets. Of course, these real-life “moguls” and “tycoons” won’t be flying JetBlue anytime soon, a point the approach obviously concedes. But my sense is that the real target of the campaign–road warriors for whom a few extra inches of legroom really does make a difference –won’t be charmed by its sarcastic tone.

JetBlue’s brand personality has always been friendly. But this campaign’s smarmy tone and intentionally insincere “Welcome Aboard!” slogan is out of character. It may provide a nice short publicity burst for the airline, but don’t expect it to fly for long.

Last night’s Super Bowl was another game for the ages. The Steelers and Cardinals showed amazing poise, grit and determination in a game that went down to the wire. It’s too bad only one of them could win.

Unlike the football teams, any number of the advertisers in the annual showcase could have scored victories. But in a triumph of low expectations, the overall performance of the ads in this year’s game was as tepid as the economy.

My company pioneered the first real-time, online commercials rating site, ADBOWL.com. For nine years we’ve had a close-up view of how advertisers win, how they lose, and why some should just stay home. This year many marketing prognosticators predicted a down year for ads in the big game and, unfortunately, most of the advertisers took it to heart.

The one spot that stood out to me was Coca-Cola’s “Avatar“. Unfortunately, it aired midway through the second half of the game when most people had already been numbed by the ads that preceded it. And it didn’t score high in any of the post game polls, including ADBOWL.

I have a theory as to the reason why “Avatar” didn’t fare well. The spot was a metaphor for how technology is depersonalizing us as a society, and how a simple moment over a bottle of Coke (what else) can reconnect people. It was a nice thought, as well timed for the age of the Blackberry as Apple’s “1984″ was at the dawn of the PC era.

The problem with the Coke commercial was, simply, that it required a little thinking to understand. Most older viewers probably don’t understand what avatars represent, and younger viewers to whom avatars are second nature have no frame of reference to grasp the deeper point the spot was making. Both problems could have been overcome with a bit of questioning, reflection and discussion, which was probably just the type of activity Coke was trying to stimulate. Unfortunately, thinking things through is something people just aren’t willing to do these days.

That, as much as anything, describes where we are as a culture at this moment in history. All we have the time (or patience) for is in your face, hit-me-over-the-head messaging. We don’t want to take the trouble to think anything through. That’s why consumers cranked up the debt machine over the last decade, its why many companies were happy to take on their risky debt, and it’s why we think a trillion dollar “stimulus” package is going to help. We simply won’t take time to think consequentially as to how we got here and what the real answers are.

Last night, the biggest stage in the advertising world offered a terrific opportunity for a courageous and forward thinking advertiser to make a bold statement. Coke came the closest of any of them, but its point was largely missed.

Sigh. Maybe next year.

On Saturday I came across a full-page newspaper ad for Citi that featured, considering the circumstances, an unusual statement at the top: “Providing Stability. Securing the Future.” Clearly, someone in the marketing department is not paying attention.

Perhaps it’s not the marketing department’s fault. After all, Citigroup has been ignoring marketing fundamentals for years. Recently unveiled plans to save the company are based on the same inside-out logic that got it into trouble in the first place. Citi is segregating its most troubled business units into a division called Citi Holdings, while keeping its investment bank, credit card operations, regional bank and private bank together under the resurrected moniker Citicorp. The company’s problem has always been a schizophrenic lack of focus, and it’s hard to see how separating divisions based on performance (rather than market dynamics) will make that any better.

I know Citi is a financial services company, but somebody ought to let the marketers have a turn. Unfortunately, they seem to be relegated to a support role, creating ads like the one in Saturday’s paper. The irony is the company’s continued use of its tagline, “Citi never sleeps.” As Citi management continues to be buffeted by a collapsing business model, that’s probably more true than ever.