Walmart`s E-Commerce Strategy to Take on Amazon
| Case Code: BSTR629
Case Length: 18 Pages
Pub Date: 2022
Teaching Note: Not Available
Organization : Walmart Inc.
Industry : Retailing
Countries : United States
Themes: RetailTech, Competitive Strategy, E-commerce,,Digital Strategy
Abstract Case Intro 1 Case Intro 2 Excerpts
Building an E-Commerce Strategy
Walmart found that transitioning from a traditional brick and mortar retail chain to one that adopted an online and further an omnichannel strategy was by no means easy. The retailer leveraged on the large amount of consumer data it had from its retail stores to craft its online strategy and adapt to the needs of digital customers. Walmart decided to focus on offering customers a seamless shopping experience, be it online, in a store, or on a mobile device. In 2000, Walmart.com was launched to provide US customers the option to shop online, followed by the launch of samsclub.com the same year. In 2007, Walmart.com launched its ‘Site to Store’ service, where customers could make a purchase online and pick up merchandise in stores...
Integrating offline and Online operations
The key pillar of Walmart’s e-commerce strategy was an innovative omnichannel strategy. The company provided a variety of omnichannel services like grocery pickup, enabling customers to place an online order with an in-store associate, and getting customers who visited its stores to go to its website.
In 2016, Walmart opened its Culinary & Innovation Center in Bentonville to develop and test new and innovative products as part of a private label strategy...
In 2018, Walmart’s online sales increased by 40 percent, and it became the third-largest e-commerce retailer in the US. Between early 2017 and early 2019, the retailer experienced a 207% growth in its e-commerce buyer base. In 2019, Walmart experienced further growth driven by online grocery sales. The company’s US e-commerce sales grew by 37% in 2019, exceeding its own internal growth targets of 35%.
According to industry experts, Walmart’s e-commerce strategy was starting to show results. According to a consumer study from retail analytics firm First Insight, Walmart (stores, website, or both) became the preferred choice over Amazon for a majority of US shoppers...
The Road Ahead
Analysts were of the opinion that e-commerce remained an expensive affair for Walmart and the company needed to make more progress to improve its profitability. They were of the view that Walmart would be able to improve its margins in e-commerce by taking initiatives like building a more favorable merchandising mix and cutting down on shipping costs, among others. “They made it easier for customers to pick up [online orders in-store], so they’ve become a viable alternative to Amazon — but they still have a long way to go,” commented Sucharita Kodali, retail analyst at Forrester ...
Exhibit I: Online Sales of Walmart by Division
Exhibit II: Comparison between Walmart and Amazon Marketplace
Exhibit III: Business Segments of Walmart
Exhibit IV: A List of Walmart Labs Acquisition
Exhibit V: Number of Retailers on Walmart.com
Exhibit VI: Financial Highlights of Walmart
Exhibit VII: Top Ten E- Commerce Retailers in the US (by sales)
Exhibit VIII: E-Commerce Sales of Walmart in the US
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