Few companies can be number one in an industry, these companies are innovative, ahead of their time, deliver to consumers what they want and change industry expectations. Walmart has held a choke hold on the supermarket industry since 1972 when they first appeared on the NYSE, opened their 51st store and achieved record sales of $78 million. Walmart through the late 1900’s and early 2000’s pushed innovation in logistics, marketing, satellite communications, and inventory. Since 2004 when E-commerce started to take off Walmart has quickly begun to lose their chokehold on the market.
Due to Walmart’s complacency through the rise of E-commerce, they have entered a state of crisis management. Amazon is a significant competition to Walmart’s business model due to their logistic advancements and bringing the supermarket to their customers home via the internet. Walmart has finally wisened up by updating their website to look eerily similar to Amazon’s. (see picture below)
Walmart has also initiated a marketing campaign to combat one of Amazon’s weaknesses, membership only free two-day shipping. Throughout these ads and on Walmart’s webpage they explicitly emphasis their free two-day shipping to everyone. (see ads below)
What is Walmart doing?
Walmart at this point is copying Amazon and frankly, that is one of the best moves they can make at this point.
What should Walmart have done?
Walmart given the vast amount of assets they had over the competition should have been doing market analyses. While they maintained the lead in the industry they should have been adapting to changes to ensure that their company thrived into the new age of the internet.
What can Walmart do now?
Walmart given their vast network of distribution centers and supermarkets should emphasis their E-commerce platform and expand into the grocery and produce delivery market. Amazon for years has tried to take hold of this market and due to the logistical challenges of bringing produce to customers houses has seen little success in this market. Due to the high density of Walmart’s within the united states, Walmart would have no problem converting Walmart’s centralized within highly populated areas into delivery nodes in their logistics network. Additionally, Walmart should market themselves as directly against Amazon before it is too late. They can accomplish this by continuing to emphasize the barrier to service that Amazon has which is their membership fee. (see distribution of Walmart’s vs Amazon Fulfillment centers below)
Amazon Distribution & Fulfillment Centers
Walmart Distribution Centers & Stores
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