Walmart is facing increasing competition from online retailers like Amazon and needs to evolve its business model. It is testing several strategies to better integrate its online and physical retail operations, including allowing customers to buy online and pick up in stores, improving the in-store shopping experience, and using data to optimize inventory placement. Walmart is also focusing on cutting costs through operational efficiencies and investing heavily in ecommerce and technology to adapt to changing customer demands. However, online retail remains less profitable than physical stores, and Walmart must find the right balance to continue growing sales while maintaining profitability.

1. Walmart – Thinking Outside the Box

4.  Walmart conquered America with “Big Box”
stores.
 BENTONVILLE - where the world’s biggest
retailer hones some of the new ideas which,
it hopes, will help it keep its crown.
 Touch & Feel of Vegetables – Quicker
checkout processes.
 Evergoing challenge for Brick & Mortar –
“Evolve or Decline”.
 Macy’s and Gap share prices ↓25%.
 American ecommerce= 9.3% in 2014 to
10.4% in 2015.
 Amazon Sales in North America
rising by nearly 30% in 2015.

6. Value Propositions
 EDLP – “Every Day Low Prices”.
 Food, toothpaste, soap, paper towels etc.– Walmart
is the King.
 Supply chain being the main focus Walmart
changed the product strategy of companies like
P&G.
 Operational Efficiency:
Noodles shape change: 500 lorries off the road.
Concentrated version of detergent: 57000 tons of
cardboards
& 400Mn gallons of water saved.
 Conflict: Job destroyers or creators.
i. 11% of Chinese imports to US in 2013.
ii. 400,000 American jobs displaced between 2001-
2013
iii. Walmart claims 2/3rd of products are “sourced” in

7.  Walmart is raising workers’ wages, for better
service.
 More than $1 billion to ecommerce this year
while Last year $10.5 billion into IT.
 Main issue is growth in Sales and the challenge
is to Merge.
 Strategy: Operate with the lowest costs,
sell at the cheapest prices and watch sales
grow.
Bentonville Believers
 Discipline in terms of employee involvement.
 Each employee is sure of his/her tasks,or “go-
dos”
 Decline in leadership: Low price is not a unique
factor – competitors intervention.

8. WALMART vs AMAZON
 Low price vs Price, Range & Convenience.
 Fast shipping.
 Amazon prime.
 Amazon dash.
 Pharmacy chains such as Walgreens and CV
S faces huge threat.
 Walmart being less vulnerable because
groceries and food sale is not easy online.
 Narrowing down wealth gap of A’s & W’s
customers is a threat to Walmart. (Chart)

10. Clicks vs Bricks
 Less profitability.
 Same customer segment target.
“You pour from one bucket into a less
profitable
bucket”.
 Self cannibalization.
 Challenges of closing down underperforming
shops and cutting down network size
 Retails space per person, sq. metre.. (Chart)

12. Strategy Phoenix
 Offer more goods at low prices to more
consumers.
 “The best thing you can do is always somethi
ng that makes what you already do better,”.
 Combining of existing Brick & Mortar stores,
supply chain, assets etc. with growing e-
commerce business and array of new digital
and analytical tools.
 New technology platform – how website works
– how to manage customer payments and
analyses data.
 Lowered volume of boxes shipped by about
1/3rd by using 27 types instead of 12.

13.  Combining sales figures from its
shops and data from its website to discern
which goods to keep where.
 Buy from online and collect from stores at no
charge.
 Eg. In Rogers, online shoppers park in
special bays and their Walmart app signals
their arrival. Staff roll out crates of groceries,
load them into vehicles & send shoppers
their way.
 Boost sales by making them more attractive,
easier places to visit.
 Raised its minimum wage to $10 this year to
improve customer service.

14.  App to pinpoint a salsa or pram.
 View expanded selection online and pay.
 Staff with handheld devices with apps to
simplify common tasks.
 Scrappers to remove icing at bottom of tubs
saves 35+ lorry loads of butter cream
icing/year.
Latest
 Amazon prime annual fee $99 vs Walmart’s
testing of $49 for free delivery.
 Shipping cost and technology still makes less
profitable in long term.
 More cutting down of price….. But….
 Walmart must now contend with millions of sm
all ones, piled high on America’s doorsteps.