Walmart, the US retail giant that’s best known for its chain of brick-and-mortar stores, is taking steps to challenge the Internet dominance of Amazon.com. But is the Walmart e-commerce strategy enough for it to overtake Amazon?
Walmart’s e-commerce operations revealed a measly 23 percent growth in the fourth period of 2017. The company had previously posted a 50 percent growth in the third quarter and a 60 percent growth in the two previous periods.
Walmart E-Commerce Strategy Prospects
However, many industry experts expect that the US firm’s e-commerce strategy will reap dividends later this year. Analyst Oliver Chen of financial services firm Cowen & Co. says that Walmart’s strategy is well-planned and could pay off later on.
Chen says many people overlook the advantage of Walmart’s store fleet, which Amazon does not have. He cites that the brick and mortar stores of Walmart will help it in accepting more online orders and boost its same-day deliveries.
In 2017, Walmart acquired Jet.com in hopes of giving its e-commerce business a boost. It has been more than a year since the acquisition but the results have been not as encouraging as many had expected it to be. However, Walmart believes that Jet will go through a period of adjustment before growing again in the future. Walmart CEO Doug McMillon, in a recent conference call, says Jet will be well-positioned in the next few years.
The company says it will also launched a newly revamped website that focuses more on home and fashion items. It will partner with
Lord & Taylor to bring luxury clothing items to its website. Walmart.com will also have a smart cart technology that became well-known on Jet.com.
Walmart E-Commerce Growth
GlobalData Retail says that Walmart is following the same strategy that Amazon took by taking less profit for the opportunity of building a stronger and better business model in the future. The idea is that taking a page from its competitor’s playbook would enable the US multinational firm to beat Amazon at its own game.
Walmart says the e-commerce sales in the US should grow by 40 percent in 2019. It says that investments in new technology and brands can help it in attracting new customers and achieving its goal of getting a bigger share of the sales pie.
It remains to be seen whether the Walmart e-commerce strategy will pay off in the future. But for now, experts and industry watchers are firmly betting on Walmart to succeed.