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Published: October 04, 2013

Chief marketing officers should really be chief innovation officers, Walmart CMO Stephen Quinn,said in remarks at the Association of National Advertisers Masters of Marketing conference in Phoenix on Friday, urging attendees to take charge of innovating at their employers.

“Our companies need innovation, and they need a customer focus,” Mr. Quinn said. “It’s not going to happen if the people in this room don’t go back and be the leaders that make that happen inside their companies.”

At 2,200 people, the crowd set a record for the ANA Masters of Marketing Conference. About 1,000 of those present were ANA-member marketers, while the remainder comprised media, agencies and other marketing-services vendors

A focus on innovation at Walmart has ramifications not just in obvious areas — like rolling out a mobile app that lets customers make grocery lists, then check on deals and navigate stores to find items — but also in how Walmart staffs its marketing functions and views agencies, Mr. Quinn said.

Walmart allocates marketing staff on a 70-20-10 ratio, with 70% working on “Now,” or the things that drive the giant retailer’s business today; 20% focusing on what’s “New,” such as a Facebook following of 34 million; and 10% focused on what’s “Next.”

It’s not always easy, Mr. Quinn said, to protect the “next” from the “now.”

“You take people who are mavericks and innovators, and you put them on the things you think are going to be important,” he said. “A big part of my job is to protect those people, because the core of your business will try to kill them.”

Innovation can also come to bear in ad production. When Walmart found that ads containing blanket messages about its low prices weren’t that convincing, the retailer turned to airing hundreds of ads in 70 local markets, comparing real customers’ shopping basket prices at Walmart to what they spent at local competitors.

And so another part of innovation became doing that economically, which involved bringing in-house much of the production for 1,500 TV commercials a year and some other agency services. That has helped reduce the cost of shooting a TV spot by 90%, he said.

Agencies still play a key role by providing outside perspectives that are vital to innovation, Mr. Quinn added. “They’re out in the world,” he said. “They’re not sitting in the building at Walmart. They’re experiencing this change as customers, as creative talent.”

Walmart also sees its role in innovation more broadly in engineering some social or economic change, according to Mr. Quinn, citing its recent program offering jobs to every honorably discharged veteran from the past 12 months and its effort to increase sourcing of U.S.-made products by $50 billion over the next 10 years. The company also recently held a summit aimed at getting more manufacturers to locate factories in the United States.

“It’s our role to be a catalyst,” Mr. Quinn said, “because we are a big, convening power that makes change happen for good, because it’s vitally important to Walmart that America be healthy.”