Ecommerce is an existential threat to Walmart, and it’s furiously trying to get on top of it, whatever the cost may be.
Walmart, determined in an existential sense to become a factor in ecommerce, has been spending vast sums of money to get there, including blowing billions of dollars on acquisitions of ecommerce startups. But the mind-boggling $3.3 billion purchase in 2016 of Jet.com – an over-hyped online retailer that had started doing business in 2015 – wasn’t the ticket.
Walmart conceded as much Wednesday afternoon. The admission was likely prodded by an investigative report by Reuters that appeared at the same time, detailing to what extent sales at Jet.com had shrunk, and how Walmart.com had been quietly absorbing Jet’s people and winding it down. $3.3 billion down the tubes.
Walmart’s ecommerce business is already huge, and it’s now disclosing the actual dollar figures in its SEC filings. During the quarter ended April 30, its ecommerce sales in the US jumped by 34% year-over-year to $4.3 billion (10-Q filing).
At this rate of growth, its ecommerce sales in the US will hit $5.8 billion in the same quarter next year. By comparison, Macy’s total sales, brick-and-mortar plus ecommerce, fell to $5.5 billion in the quarter despite its thriving online business. Walmart went from on online non-entity a few years ago to the third largest online retailer in the US in 2018, according to eMarketer estimates, behind only Amazon, eBay.
Its online business is growing far faster than that of Amazon. But for Walmart, that massive $4.3 billion in US online sales last quarter was only a 5.3% sliver of its total US sales of $80 billion.
By contrast, other brick-and-mortar retailers that now disclose actual online sales (not many do), Nordstrom and Neiman Marcus get over 30% of their total sales from ecommerce. Walmart has a long way to go. But Jet.com wasn’t it.
Walmart is also investing heavily to build out its ecommerce infrastructure and technologies. By the end of last fiscal year (10-K filing), it had 33 “dedicated ecommerce fulfillment centers” around the country, up from 17 a year earlier. For the year, it listed $5.2 billion in capital expenditures for “eCommerce, technology, supply chain and other,” up 16% from the prior year, compared to only $2.1 billion for store remodels and $313 million for new stores.
In the last fiscal year, Walmart’s ecommerce sales in the US reached $15.7 billion! But that was only 4% of its total US sales.
Ecommerce is an existential threat for Walmart, unless it gets on top of it. But the $3.3 billion acquisition of the tiny Jet in 2016 was a waste.
In its press release on Wednesday, Walmart tried to put the best face on it. It has been “repositioning the Jet business,” it says. “While this has made Jet smaller from a sales perspective, it has helped us create a smart portfolio approach where our businesses complement each other.”
“We’re now merging the rest of our Jet teams, including Retail, Marketing, Technology, Analytics, Product and several others within Walmart,” it says. So, at least no layoffs.
Jet’s president Simon Belsham will depart at the end of August, it says.
“This natural progression of integrating an acquisition, allows us to fully leverage Walmart’s assets for Jet and leverage Jet’s talent for Walmart,” it says.
Reuters has been digging into the changes at Jet for months, based on interviews of six sources among Jet suppliers, two consultants advising Walmart on its ecommerce business, and three Walmart employees. And it likely triggered Walmart’s press release.
These are the most salient findings in the Reuters investigative report:
Jet.com, which was expected to boost Walmart’s reach particularly with city dwellers and millennial shoppers, failed to become a driver for online grocery sales and growing market share in urban areas.
Walmart has put more emphasis on shopper perks such as same-day delivery and curbside pickup of groceries ordered online, focusing on food and grocery sales using those delivery methods. Jet, as a platform to sell similar items, has fallen by the wayside.
Multiple large and medium-sized consumer goods companies that do business with both Walmart and Jet have told Reuters they began noticing Walmart executives buying less of their merchandise to sell through Jet. The reductions in Walmart’s order sizes for its Jet unit, they said, started in March….
In 2016, Jet forecast revenue of $1 billion and according to recent estimates from consulting firm Kantar, which was shared with some vendors, the company’s sales shrunk to $689 million in 2019.
Several vendors, who told Reuters they were keen to introduce new packaging and pricing on Walmart.com and Walmart-owned websites like Jet this year, said the retailer told them to look for ways to push more sales on Walmart.com going forward and not spend resources on a new strategy for sales of their merchandise on Jet.
Two retail consultants, who advise Walmart on e-commerce and online grocery, have confirmed to Reuters that Jet is failing to keep pace with Walmart’s internal sales goals.
They said Walmart has de-prioritized the business and is focusing more on growing sales through its namesake website and offering a broader assortment of fashion and accessories through the multiple smaller brands like Moosejaw, Modcloth, Bonobos, Eloquii, Hayneedle and others it has acquired in the past few years to attract millennials.
For years, Walmart had rested on the laurels of being America’s largest retailer, with its thousands of brick-and-mortar stores spread around the country. But as Amazon surged to being a real threat, Walmart got religion.
It first pushed states to remove the “Amazon subsidy” – the fact that Amazon sold merchandise across the US without collecting sales taxes. In 2012, California became one of the first states to compel Amazon to collect sales taxes. Other states followed. By early 2017, Amazon was collecting sales taxes in all 45 states that have state-wide sales taxes and in Washington DC.
Yet, even as the “Amazon subsidy” disappeared, Amazon’s sales continued to surge, as did the online sales at brick-and-mortar retailers, while Walmart’s brick-and-mortar sales stalled. And so it desperately started throwing its billions around in order to catch up and remain relevant in the changing US retail environment. Some of these efforts were successful, but others, like the immensely hyped acquisition of Jet, were a costly failure.
Private-equity owned Neiman Marcus disclosed two things: Awful operating results and a deal with its beaten-up creditors who, under threat of getting clobbered in bankruptcy court, agreed to not sue over a blatant act of “collateral stripping” – and what the crazy-hot IPO market has to do with it. Read… The Fed Calls it “Collateral Stripping.” These PE Firms Took it to the Next Level and Just Got Away With It
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It almost sound like Walmart is a pharma, throwing $ at different molecules trying to find the success. But then, in a way, the retail space is like pharma in that way. The biggest difference being there would be only one equivalent therapeutic area. Unfortunately for all the competitors, Amazon has gotten to that area, or is getting close to it first.
Fortunately, this isn’t a zero sum game
For the past 1 year+ I have gone from exclusive amazon customer (ditching prime also) to shopping online at both walmart and amazon. Walmart has amazon beat on price on a lot of everyday items and offers competitive free delivery minimums. Sorry that sounds like a walmart ad, but lower prices win.
Amazon has one of the most incredible combinations of Information, Suggestion, Price Comparison, Availability and Delivery. It is a retail PowerHouse.
The thing is you can use that information to find the vendor and deal directly with them. Vendors may choose to offer incentives and sign up with Amazon as a no cost come on. Brick and mortar used to be a discovery mechanism for consumers. Check it out at the store buy it online and avoid sales tax and get a lower price. Now perhaps the shoe is on the other foot.
I shop at both Amazon and Walmart as well.
I find that I buy different stuff from the two though.
Amazon is books and small stuff (parts for my weed whacker, toys for my kids, a 3D puzzle etc). I know they sell everything, but…
Walmart has been bigger ticket items – a vacuum cleaner, furniture, exercise equipment. I know they also sell everything, but…
They just have different strengths, and I’m not sure that’s a bad thing.
Walmart often wins on price, particularly on larger items. They also have a local presence if I need to return something (also handy late at night if we run out of diapers). Amazon has huge selection, and their checkout process somehow just has less friction.
I almost wonder why they’re so worried about each other. If you really drill down, I’m not so certain that they’re actually in the same business.
One advantage of shopping online at Walmart is the fact I can go to the store to pick up my order. So e of you will wonder why I go through the trouble of ordering online only to go to my local Walmart store to pick it up, but you have to worry about porch thieves who follow Amazon trucks.
I just compared one of my common purchases (Taste of the Wild dog food, 28 lbs) at both and the price is the same ($28.99) down to the penny. Looks like collusion to me.
People like to say that Sears was in the premier position to take advantage of the internet in the mid 90’s when they closed their catalog division, but Walmart has been trying to beat Amazon since 1998 and hasn’t been very successful as of yet.
+1 that’s been my experience, too. the site isn’t as slick as amazon’s but it’s almost as quick which is hopd enough for me. there’s also a nice search plugin for firefox.
sorry, my comment was in response to oliver klozoff’s praising walmart’s site.
Online sales improve when the store no longer keeps stock on the shelves or inventory. It’s not that people necessarily want ecommerce its finding what you want in the store, without making it into a daytrip. Gas at four bucks contributes, rubbing elbows with homeless and those working beneath a living wage, is also a concern. I don’t have to shower first, plus.
Little inventory on the shelfs are an issue. I actually went to a Best Buy the other day (1st time in the last decade) and was completely shocked by the lack of in store merchandise.
“I don’t have to shower first, plus.”
-My condolences to Mrs. Ambrose Bierce :).
Staples stopped carrying boxes of legal paper and instead offered packages at twice the price. So I go home and order it online with free delivery. The delivery wont be free forever though but peeps will have been conditioned to buy online instead of requiring in-store inventory. The next iteration will be order it online and pick it up free at the “store.” And then it will be 2-day or 3-day delivery to the store… just my opinion.
“The next iteration will be order it online and pick it up free at the ‘store.'”
They’ve been doing that for years already. I bought an Ipad that way from Walmart about 4 years ago, and have bought stuff from Macy’s that way, too.
I guess Wal-Mart knows best, but it did seem like their online business got better for the consumer after Jet.com. It’s still not as good as Amazon.
Wal-Mart and Amazon’s profit is in the same ball park (but Amazon’s changes fast- so who knows).
Wal-Mart makes about double what Amazon makes in its retail biz (if I am enough of an accountant).
I don’t think it’s desperate for Wal-Mart….yet.
I am skeptical of new grocery stores- like Amazon’s (who has already failed once at it).
If there is a big reset of online enterprise values, e.g. web services get re-priced- Amazon will be a very different animal; and Wal-Mart will cruise along.
I’m still convinced Walmart’s acquisition of Jet.com was
B. Insider trading involved.
D. All of the above.
I’m not making the case that they didn’t need to make strides in their online presence… Simply that jet was a unremarkable e-commerce company.
I mean how many people were even using it and further more what was so great about their platform that made people want to shop there?
I got nothing. Walmart could have spent their money much more wisely.
Apparently I incorrectly assumed Walmart’s 2016 Jet purchase was simply buying technology talent for soon-to-be-consolidated Walmart + Jet e-commerce capability. Just a wild guess, but I’d think it’s hard for Walmart to recruit & retain top-of-class IT talent.
Until reading this post, didn’t realize Jet & Walmart were still separate; also didn’t realize how small Walmart e-commerce was as % of total Walmart sales.
Not only is Walmart contending with Amazon, but Dollar stores have been taking huge market share in the lower income market segment.
Jet acquisition was definitely about talent. Jet leadership replaced existing Wal-Mart.com leaders
Was saddened when Jet got bought out by WMT. Jet was a fine alternative to AMZN. At the time, thought that WMT wouldn’t benefit by the purchase but AMZN would.
WMT realizes that its long-term strategy of locating megastores on the edge of town now looks like a losing proposition. Buying up small ecommerce startups isn’t the answer either. All the talent bails out immediately, the buzz dies out, leaving the company with decaying goodwill on the balance sheet.
WMT has issues for sure but if it wants to succeed, perhaps a new brand would work? A smaller store format, located closer to the center of town, offering non-generic merchandise. In other words, do the OPPOSITE of what AMZN is attempting with Whole Foods, where they’ve eliminated thousands of small suppliers with unique offerings.
I am not sure how they are doing finqncially, but I guess Walmart Neighborhood Stores is their attempt to do what you suggesting.
The acquisition of Jet was all about ecommerce talent acquisition. It made a big difference in their operation. They’ve been doing the same thing in adtech, so look for results there soon also.
The biggest problem that companies like Walmart have competing with Amazon is that they expect to be profitable, whereas Amazon is still considered “tech” rather than retail so its profits don’t matter.
Eventually, “tech” will lose it’s mystical savvy and investors will want results. Amazon investors will realize they simply own an online retailer with very limited pricing power.
amazon’s strategy is to use cloud services and logistics as their main profit center. the retail just builds the volume necessary for them to run their cloud services. that’s a strategy walmart is unlikely to duplicate.
eCommerce is the future as the brick and mortar stores have money tied up in inventories which must be turned about every month to make profits. With eCommerce, goods have a bigger demand audience so they can move that inventory more quickly.
I have noticed many stores today only carry products that move off the shelves. Its not like years past when you could find anything you wanted, but I noticed Home Depot and Bed, Bath, and Beyond still have adequate goods on the shelves. I agree Best Buy has lowered the inventory in stores except for TV’s.
2018 revenue: $232.9B
2018 After-tax profit: $10.1B…and AMZN had 2018 CAPEX of $13B
Looks like they already pricing power (comments here indicate AMZN is generally not lowest price), and could cut price if they if they decided they need to.
It’s easy to look at AMZN financials and say “…they aren’t making any profit…”; Bezos basically takes everything AMZN makes & reinvests to continue torrid growth rate (previous year’s CAPEX translates into next year’s non-cash depreciation expense).
Correct. At the retail level, WALMART has a “profit model” and AMAZON does not — ‘simple FACT, ‘long-established. And yet WALMART persists in “competing” head-to-head with AMAZON. Being “in-the-trenches” with the former, I can tell you first-hand that WALMART’s “gains” in e-commerce have been at the direct expense of brick&mortar stores — not just Customers, but store personnel. ENORMOUS CHANGES in-store were instituted a year ago (mid-July); ‘may have looked good “on paper”, but the requisite preliminary measures never happened; i.e., suitable requisite staffing levels for every one of the “new teams” failed miserably. This situation persists. Existing staff, consequently, got shoved this way, then that way, then some other way … and a whole bunch upped-&-quit (especially the necessary “new hires”) or retired early. Ever-more was required of those remaining — twice the workload, in “less time”. Annual “Performance Evaluations” — already a “good faith” bad joke for years — became outright offensive and insulting … the point being to find any excuse to deny earned pay raises based on actual performance, so as to reduce “labor expenses” and thus boost the Store’s “bottom line”. A fool’s errand, since the year-old “OnLine Grocery Pick-up” (OGP) e-commerce initiative presently entails some TWO DOZEN full-time and part-time Store “Shoppers”. Consequently, “on-site” Shoppers are actually (literally) subsidizing “online” Shoppers via higher in-store pricing. Nobody ever “talks” about that fact — nor about the gigantic in-store remodeling project costs entailed that (has) enabled OGP! Worse, the July 2018 MAJOR CHANGES almost entirely affected “stocking” — which, until then, had almost exclusively occurred “overnight” — or, on 3rd shift. INCREDIBLY, the vast majority of “stocking” tasks were transferred to 2nd shift (2pm to 11pm) — or, during the “busiest” Customer Traffic hours! Worse, ridiculously “bad tools” were introduced for use by 2nd Shift for stocking purposes
— which were obviously NOT SUITABLE for stocking purposes PLUS were obviously highly disruptive to Shopper/Customer “traffic flow.” Worse, “new teams” for 1st Shift and 2nd Shift stocking purposes never reached even 50% of designated requisite/mandatory levels — and still haven’t. Worse, not less than 3 store-critical “teams” not only physically collided with each other (in the same “working space”), but one was OGP “shopping” even as the other two were attempting to work PRIOR DAY’S FREIGHT affecting fully SIX “Grocery”-related Departments! Ya think WALMART is effectively “competing” with “on-site” retailers like Target AND “online” retailers like Amazon? REALLY!? Fine. But not all all what I personally “see” InTheMix every day. The sheer stupidity and gross incompetence that I witness day after week after month after year out of CORPORATE and IN-HOUSE is mind-blowing. Every “CORE BELIEF” that WALMART once had has thoroughly disappeared (over the last 16+ years, the length of my employment at this one SuperCenter.) In-Store MANAGEMENT is utterly clueless as to “managing” (especially inventory), AND “teamwork”, AND “training/supervision”, and thus LEADERSHIP. In contrast, what “Management” is BEST at is criticism/complaint/blame.
All the “PR” (Public Relations) and “IR” (Investor Relations) statements you’re getting out of HOME (Bentonville AK) is “smoke”, IMO. This “jet.com” fiasco is mere tip-of-the-iceberg for the false steps and bad moves that CORPORATE has made — and continues to make.
There continues to be “no cure for stupid.”
E-commerce resembles fracking in that both produce large quantities of the desired things (oil in the case of frackers; sales in the case of e-commerce sellers) and both have associated expenses that would sink non-subsidized businesses.
How is Amazon a “subsidized” business?
Some other retailers may be trying & screwing up e-commerce, but no way is Amazon subsidized, especially now that it pays sales tax.
re: ‘How is Amazon a “subsidized” business?’
Amazon does not pay a living wage to many employees, who need public assistance to survive. Hence, AMZN is subsidized by the taxpayer (just like WMT):
Indeed. And Amazon doesn’t pay sales tax, customers who buy there pay it. Amazon itself pays no taxes at all.
Amazon doesn’t pay sales tax. We consumers do.
Consumers don’t write a check to the government to pay the sales tax, Amazon does so they definitely pay the sales tax.
Retail is and always has been a low paying industry. Walmart is no exception and probably pays no worse than the marginal mom & pop stores that used to dot the landscape. Taking 100% of Walmart’s $6.7B profit & paying it to the 2.2M employees amounts to a $1.50 raise.
Walmart is under attack from amazon across all their business, and the Dollars stores (which pay less than Walmart) are taking massive market share in the lower income end of the market. If Walmart raises prices, they lose market share.
By the way, it’s hundreds of millions of customers who refuse to pay higher prices.
PAYING SALES TAX:
We’re quibbling over terms regarding who pays sales tax, and you know it. Before Amazon collected sales tax, customers effectively got discount (most customers knew about and enjoyed this).
Amazon now collects sales tax from customers, and Amazon actually pays the sales tax to the taxing authorities.
In the above comment, it should have said:
“Taking 100% of Walmart’s $6.7B profit & paying it to the 2.2M employees amounts to a $1.50 PER HOUR raise.”
How many years did Amazon not collect sales taxes on sales which gave them the a head start and ability to crush the smaller brick and mortar traders?? To me that is/was a (political) disgrace.
AMZN was founded in 1994, and I assume it was a number (10+ ?) years.
You failed to mention that what AMZN did was absolutely legal and other vendors did it as well (laws have since been changed, and AMZN is in compliance).
At least in CA (and I presume in all states with sales tax) the individual has always been ultimately legally responsible for reporting & paying sales tax on their purchases if an out-of-state vendor failed to do it for them.
Assuming you’re from CA, I’m certain you and other Californian’s have always been in strict compliance with this legal requirement. If not, you can easily print lists from AMZN so you can file back taxes.
I think Walmart’s website is terrible. I’ve tried to use it several times and finally have given up on it. They frequently have inadequate or incorrect information on the product and often fail to answer the most basic question about the product. In addition they will list 1000’s of results for the most specific search. Apparently they, like Amazon, also host 3rd party retailers. But the shear number of responses for the same item is overwhelming, and it is difficult to tell if any of them are a product from Walmart.
I think they will find themselves hindered in growing their e-commerce until their site improves. But though many brick and mortar stores have sites that aren’t very user friendly, many do, like Nordstrom. In addition
Home Depot has one of the best sites on the web. All the specs, manuals, instructions, user questions, and review are readily available. It is easy to see if the product is available in a store nearby and if so exactly where it is located in the store. LLBean, Rockler, the outdoor clothing retailers, eReplacement parts, among others all have excellent sites that are easy to use. Amazon’s site is not the best by far, but it is pretty good, especially considering the diversity of products that they carry.
Finally, if you consider how bad the Walmart site is on a laptop, think about what it is like on a smart phone, which is the only computer a lot of their customer base owns.
Similar situation with BN’s website, try buying books there, it’s such an inferior experience compared to Amazon.
Iphone or Fire tablet on Walmart is adequate. Not good on cheap Android. Amazon won’t let me order as guest. Often research what I want on Amazon and order off Walmart or Ebay. Amazon turned into a nagging girlfriend that wants me to buy stuff. Walmart slips in the junk-mail-check-box every once and a while but it is easy to turn off.
“it is difficult to tell if any of them are a product from Walmart.” In the search is a check-box for Walmart (and others) on the left hand side. Walmart has 2 day FedEX delivery check-box in the search also. The only issue I’ve had is sometimes Walmart hiccups. Hasn’t happened often enough or had any bad consequences yet (knock-on-wood).
Home Depot….one of the best? You jest. You seemingly have not savored their website search for very specific items vs what their all knowing gurus THINK you want, nor compared their “in stock” on items shown vs reality when you arrive to purchase….
Walmart’s inventory is very large. Maintaining Walmart’s online operation is a formidable task. Thousands of employees working day and night to run the website. Then there’s the logistics of storage and delivery of the products. Many of the items are or could be shipped directly from the producer bypassing the Walmart physical structure entirely. Walmart has an opportunity to reduce expenses if it can bully the producer into assuming the cost of transportation.
I don’t shop Walmart.com, but Samsclub online is awesome. It has real time inventory at the store, plus free shipping with the Plus membership on practically everything they sell online. Most times that I order, I feel bad because I know they’re losing money on my orders.
I believe you are fundamentally misinterpreting Walmart’s intent in its acquisition of Jet.com
Walmart’s master plan was always to eliminate a potential competitor that was starting to grow and to strip its assets. It had to pay a big price to do this given the crazy stock market valuations. Jet’s main asset was its growing list of suppliers and sellers – I was starting to notice it was popping up frequently alongside Amazon in my internet searches for products.
In the early 1990s I had a neighbor who became an instant millionaire when his small company in Oxnard got bought out by its main competitor for 20x EBITD (according to him). His company manufactured custom rubber stamps, the kind that every office needed to speed up paperwork, before everything went digital. The key was when his company snatched the exclusive contract for making these things for Office Depot away from its competitor, then the dominant supplier in the market.
A few months afterwards, his company got shut down. Over 60 people lost their jobs. But the buyer of his company had its contracts back and had stopped this upstart competitor that was becoming a growing existential threat
Ha, that’s hilarious: Jet.com a competitor of Walmart….
The competitor of the largest retailer in the world wasn’t a startup with few sales but Amazon that has been eating Walmart’s lunch on a grand scale. If Walmart wants to get rid of a competitor, it would need to buy Amazon. But at a price tag of around $1 trillion (market cap plus a little premium), Amazon would be a tough nut to crack even for Walmart.
If I am reading this article right, Wolf is saying that the future of retail is “hybrid retail”. Keep the profitable parts (look at previous Wolf articles for details) and focus on shifting existing retail to e-commerce. Re-focus failed retail locations to fulfillment centers, and use existing in-house distribution to distribute goods.
I never (really never ever ever ever^46525) thought I will say this out loud, but Walmart seems to be going in the right direction.
The basic problem with WalMart is that it is infested with the sort of people who are willing to wait in line for 15 minutes to save $5.
The last time I went into a WalMart to pick up a package, I got to go to “Customer Service” and wait in a long line behind people who were returning stuff and a guy who was apparently wiring money to Guatemala.
With Amazon locker, you walk up to the big yellow wall, wave your bar-code in front of the scanner, and the appropriate door opens for you. Total elapsed time, maybe 15 seconds.
WalMart really, really needs to get their act together if they want to have any hope of beating Amazon.
Yep last time I was at Wal’s I saw a fist fight almost break out at one of the self checkouts, a tattooed trailer park type guy was being “disrespected” and was challenging a guy to fight right there. I walked past quickly, lol.
I just ordered another book from Amazon, and it’ll come to the Amazon locker. Even for the flip phone set it’s easy – they send me an email with a code, I type it in, the door pops open. Some of the lockers are in “ratchet” locations like 7-11’s but once I discovered the one at Whole Foods I never went back.
My butler gets me what I want, when I want. People like you who drive to Amazon locker increase the traffic.
Ehh, I’m generally going to Whole Foods anyway. House brand heavy cream for coffee, best avocados – not cheapest but best – I’ve found, etc. Nuts’n’seeds cheaper than anywhere else. Safeway downtown has closed so if I feel like some rockfish, WF will be my go-to.
Walmart is 3rd behind Amazon, Ebay, and Apple. Don’t you mean 4th or should one of those not be included?
Wolf’s link showed the report where Walmart recently overtook Apple.
Oops. Yes, third. Behind Amazon and eBay. Thanks.
“Walmart has put more emphasis on shopper perks such as same-day delivery
Around here, WalMart uses FedEx exclusively. Good luck with on-time same-day delivery.
FedEx has just quit trying to deliver Amazon Prime orders within Amazon’s timeframe. They were chronically late here and misdelivered orders to wrong destinations far too often.
Here’s a sample of one. Hanford CA (Central Valley) has a 24/7 Walmart ‘Supercenter.’ At times it’s jammed. Much of the rest of the time it looks and feels like a money-eating mausoleum (hat tip to Sal Bando). The online grocery service is fairly busy. The non-grocery online pickup center is not nearly as busy. There are more old than young customers in the store, but still plenty of youngins. As in many poor locales, the digital divide is significant here. Older people are far less connected than the young, and the plentiful poor and young are less connected than the more prosperous young.
I’m hazarding a guess that Walmart still turns a profit on the store, though the pernicious financial concepts of Neoliberalism would probably give it a near-failing performance grade.
Walmart is surviving and somewhat prospering at the moment with its hybrid www/brick and mortar strategy. How well it will do in the future as its older and less-‘connected’ demographic ages and dies and the younger and, especially, more prosperous demographic becomes their target market is an ‘interesting’ question–as in “May you live in interesting times.”
Walmart needs to adopt a strategy and commit to the strategy.
Jet.com did not fail, Walmart executives failed.
Why not, Welcome to Walmart are you familiar with our new online program Jet.com. Here is a flyer and more information is available at the “blue light special” booth right over there.
Good article Wolf. Spot on Old Engineer. Bottom line reason Wally World bought Jet was to get Jeff Laurie and his eCommerce team. Now he is chartered with rolling that big round ball all uphill.
I’m glad Reuters researched the Jet acquisition and exposed what a horrible purchase it was. Walmart is clueless when it comes to e-commerce and modern-day retail. Bonobos has absolutely no fit with Walmart and why did they even bother with Modcloth or Hayneedle which are way too small to make a difference. People who shop at Bonobos probably go out of their way to not shop at Walmart. This is a desperate management team that threw money at a big problem and hoped something would stick. I recall Jim Cramer sucking up to Walmart management about what a great deal Jet was and how they could now go after Amazon. The things a pathetic, brown-noser like Cramer is willing to do to book guests on his show. We will probably see another lost decade for Walmart
Small potatoes, I believe the Pentagon spends almost $80 billion per month?