Case 1

Question :

Walmart’s executive team debated how to approach Jet. Should they invest in the company, purchase it, or do nothing at all? Whatever they decided, how could Walmart best use its resources to compete against major ecommerce players like Amazon? Should it playoff its existing strength in brick and mortar, focusing on its in-store business or emphasizing web-to-store delivery? Or did it dare to compete for head to head with pure ecommerce players in web-to-home sales, serving customers who expected ever-faster delivery times and lower shipping costs? Finally, should it consider an omnichannel strategy, attempting all these aspects of the business at once?

Answer :

I think they should acquire Jet. In the article, it is said that the owner of Jet, Marc Lore, has a great experience dealing with online retail. It’s said that at one point, Diapers.com, online speciality retail founded by Lore, had four times the sales from Amazon alone. This is a strong proving point that Jet has the ability and experience to manage online stores. The technological capabilities such as smart cart and its strong distribution system of Jet company can benefit Walmart. Moreover, it is said in the article that Walmart’s CEO, McMillon and Lore have shared a similar vision and value.

However, this acquisition will not work if we don’t have the right strategy. Investing only on its online stores features without integrating it with offline stores can result in loss. So we think that the best option here is to choose the omnichannel strategy. Omnichannel in Walmart should consist of integration between the in-store business practices, web-to-store delivery, and also web-to-home delivery.

By acquiring the omnichannel, it opens the opportunity of Walmart itself to achieve more target market and the trend of mobile users, and mobile shoppers keep increasing each year. In the future, everything will turn to omnichannel. Walmart also had an advantage in the large number of its physical stores that almost reach 11,718 stores in different countries. So the omnichannel strategy to gain customers through online shopping and picking up in-store is very feasible for Walmart. And this advantage resource that Walmart had in its physical stores can be a competitive advantage to its competitors ecommerce players like Amazon.

Case 2

Question :

In 2018, Marc Lore noted, “20 years into the future, the winning model in the US will be a combination of stores and ecommerce that goes beyond Omni. The stores themselves will be hybrids. We will be moving toward faster and faster delivery times, the same day and even two hours.” To reach the entire US population within a few hours, he observed, one needed thousands of warehouses—an asset Walmart already possessed. Lore added, “It’s not, ‘When everything goes online, stores die.’ The stores are integral to Walmart’s ecommerce success.” But competition in the online space remained intense, with customers now taking for granted extensive product selections and nearly immediate home delivery. Was omnichannel the right decision? If so, how should Walmart use its assets to best serve customers across all possible channels in the years to come?

Answer :

Walmart has a substantial physical presence. It possesses 11,718 stores in various nations, which makes its distribution worldwide. This encourages the delivery of items to clients as it is close and simple to reach. To win an upper hand, Walmart, with 157 distribution centres in the US, gives the customer the ability to pick its items. Likewise, Walmart coordinated an omnichannel methodology to improve its distribution ability and to offer better types of assistance. Clients are the primary concern of Walmart. The retailer is taking the necessary steps to ensure its fulfilment with ease.

Walmart’s distribution system exhibits its solid principle point, which is reachability. With the number of facilities that it has, it can efficiently deliver products to customers. The organization covers various flows of channels. The retailer keeps the chain brought together through versatile applications, an instalment framework “Walmart Pay,” and late delivery fines for third-party vendors. At long last, Walmart gives various delivery choices to clients like next-day delivery and Curbside Pickup. Walmart has a strict policy for its third-party vendors. The retailer deals with only thousands of third-party vendors and doesn’t provide many subscription options.

Additionally, Walmart offers a small option for international deliveries. It works as an online business in 10 nations, and clients have restricted options. Finally, being new in the omnichannel scene gives limited options to the delivery process compared to its contenders. Walmart’s strategy is improving from time to time because of the ability to use the current resources and put those resources into innovation. The organization has an extraordinary establishment of capital assets. It is putting resources into innovation to improve appropriate execution.

Omnichannel Pros & Cons:

The present clients associate with items through physical stores as well as all the while through cell phones and sites. Thus, Walmart’s omnichannel procedure permits it to arrive at a more extensive scope of clients with various qualities and shopping inclinations. Likewise, omnichannel permits Walmart to stay up to date with shopping patterns and satisfy the severe need for the omnichannel shopping experience. This is because omnichannel customers represent 27% of all retail deals. With a stable omnichannel system Walmart can stretch out beyond rivalry, particularly with the securing of jet.com which takes into account a more grounded internet business procedure and a superior comprehension of client conduct by approaching customers’ history and information. There are several opportunities for Walmart omnichannel strategies, which help expansion to other countries, improving the delivery system, and Investing in technology to enhance its distribution performance.

The disadvantages of having an omnichannel technique are the intense rivalry regarding item determination, transporting expenses and conveyance time. These are the fundamental difficulties looked by Walmart in coordinations and appropriation after entering the internet business world. The intricacy of the administration of the primary party stock makes a requirement for exhaustive investigations and a centre of capability. At long last, under an omnichannel system, it is hard to give consumer loyalty.

Short-term recommendation:

Focus on e-commerce activities with an emphasis on hygienic shipping of orders. Under the current COVID-19 crisis, Walmart should focus on strengthening its e-commerce activity. The virus outbreak has created a new Service Output Demand (SOD) for the consumer, which is the “degree of hygiene”. SODs such as “bulk breaking” and “spatial convenience” is of higher importance. A higher need to stock up on goods and make orders without leaving home. Walmart can deliver these SODs since it has a preset foundation. The challenge is, on the one hand, to upgrade the level of hygienic precautions in facilities. On the other hand, Walmart should be able to handle the rise in delivery requests.

Long-term recommendation:

Create a digital membership card to improve CRM and customer loyalty. Walmart’s e-commerce goal is to focus on enhancing the customer’s experience. A comprehensive loyalty program that helps in engaging Walmart’s and the competitors’ customers to live a new experience is suggested. They would enjoy new features such as on-time delivery, coupon cards, loyalty subscription programs, daily discounts, pickup facilities, etc. The primary purpose of this project is to improve customers’ satisfaction and gain better brand positioning.

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