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Walmart Business Strategy and Competitive Advantage

Wal-Mart for the past two decades plus has been the nation’s most profitable retailer, but with time there comes change, the change is now “Amazon” the e-commerce juggernaut that has taken retailer by storm. Walmart started to focus on its online and e-commerce presence in 1999, Walmart.com launched to give the customer the option to make purchases online and pick up merchandise in stores. Over the last couple years, Wal-Mart has poured much of their resources in the e-commerce side of the business because they can see the general public is changing to a digital mobile generation.

To keep up with Amazon, Wal-Mart must reinvest into two business models online and traditional retailing acting as one entity by using omnichannel strategy, acquisition of Jet.com, other strategy changes to remain competitive, to enhance sales overall, and focus on longtail markets customers. The writing is on the wall when the dinosaurs did not evolve in the ice age, they did not survive to fight another day so for Wal-Mart to survive the digital age they must evolve now to be the retailer of the future.

Wal-Mart is using omnichannel as a tactic to have a competitive advantage over Amazon in online retailing. Omnichannel retailing is the fully integrated method to online commerce that provides customers and shoppers a combined experience across all channels like mobile-browsing, online marketplaces, social media, online desktop, online mobile device, by telephone and in the store. Wal -Mart is changing from the multi-spoked approach of their retail past, to compete with Amazon with the omnichannel approach that would merge websites, emails, remarketing advertisements, social media advertising, and store locations to show better-personalized offers, products, and messages that Amazon.

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The Merger of Jet.com in 2014 with Wal-Mart was to move Wal-Mart’s e-commerce business model to the top of the retail list with Amazon. Jet.com was going to extend Walmart’s e-commerce reach with the new era shoppers and city residents, but Jet.com may have failed to become the leader that it thought it was going to become for online grocery sales, consumer products and grow their market share in urban area locations. By buying Jet.com the CEO “Mark Lore is an e-commerce legend and there are few people who, if tasked with doubling or tripling walmart.com, would be up to the challenge. Lore has a long history of successful innovation in e-commerce, which explains why Walmart, picked him and why the retail giant was willing to pay $3.3 billion for Jet.com”(Rash, 2016, para. 8). The Jet.com and Walmart merger was to make Walmart a top online retailer, but it has not worked out that way.

Amazon‘s strategy for staying competitive with Walmart and other companies start with a simple philosophy of these four principles: hunger for more invention, being obligated to operational quality and long-term goal thinking, to focus on the customer passions rather than their competitors in the physical locations and their online presence. “Walmart’s push into “Omni-channel retailing,” a strategy that lets people peruse, purchase, receive, and return goods through various channels from online to mobile apps to delivery to physical locations”(Derousseau, 2018, p. 29, para. 1). The large storefronts of Wal-Mart have helped them with their competitive advantage with Amazon for the time being. Amazon has a customer factor or focuses called a customer purchase criteria (CPC) that includes doing things better than its competition like reliable service, fast delivery, and price that is tested learned through their pivot strategy to insert their brand name into everyone’s daily habits.

No, Wal-Mart is not taking away from their physical locations by focusing on its e-commerce business unit because Walmart started as a brick and mortar location that must now evolve into an online presence to survive in this new digital world with its social media, emails and on-demand ordering. To be the very best you must compete in all-new avenues, today’s customers want their purchases faster, at a lower price with reliable service and if you are not providing those services than you are not getting their dollars. Walmart can take advantage of its existing network of over 4,700 stores to enhance sales overall is to get their products to shoppers quicker, to have their stores well-stocked, and lower prices in with store discounts. People are still drawn to brick and mortar store locations to make purchases, physically touch items, and process their exchanges, refunds, or returns. Walmart is cutting back on the new stores pace of expansion to focus more resources on their online customers and their brick and mortar customers’ needs. “Walmart and Google are linking up to offer consumers a service that currently you can only get from Amazon: voice shopping. The new agreement will add Walmart to the mix and allow voice ordering from Walmart using Google’s Home device”( Rash, 2017, p.1, para. 2). They are built on the traditional foundation philosophy of their store’s motto that customer satisfaction is a priority first.

With the acquires of Jet.com in 2016, Walmart was focusing on the online longtail markets the hard-to-find niche items that many of the city and millennial customers want and need. The purchase of Jet.com was expected to boost Walmart’s reach, particularly with city dwellers and millennial shoppers in urban areas that had a higher per capita household average than normal. “Lore’s Jet.com also brought a younger, more affluent consumers to Walmart—a new niche opportunity. This also opened the door for Lore to push Walmart to seek other long-tail niche markets, including higher-priced products and designer brands. We’re making acquisitions primarily in specialty areas that can help accelerate our business in long-tail categories. They’re the high-margin categories where we’ve made a couple of acquisitions already”(Lewis, 2017, para. 12). After the purchase of Jet.com, Wal-Mart focused on another niche or longtail markets like online outdoor retailer Moosejaw, vintage-inspired online women’s apparel site Modcloth, menswear site Bonobos, and upscale department store Lord & Taylor to reach more upscale retail customers with their extra capital.

In the end, the most technically sound, customer savvy, and the innovation-minded company shall reign supreme in this new digital age, I wish Walmart and Amazon the best in this fight to be the top dog because you will have other contenders coming down the line to take the throne remember customer happiness is always priority one if you can provide them with great prices, an array of delivery options, and outstanding customer service you will have their attention and a lot of loyalty this is just one person’s insight into the future of retailing. So, Walmart and Amazon let the games begin in the battle for the number one retailer of the digital age.

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Walmart Business Strategy and Competitive Advantage. (2020, Sep 27). Retrieved from http://studymoose.com/walmart-business-strategy-and-competitive-advantage-essay

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