E-Commerce Company: Wal-Mart
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E-Commerce Company: Wal-Mart
Wal-Mart operates supermarkets and merchandise in Europe, South America, and Asia. Currently, it is the world’s largest retail company and ranks twenty-eighth on e-commerce retailers in the United States (Ghemawat & Mark, 2006). The company owns hypermarkets, department, and grocery stores in 28 countries across three continents. The company operates in a rather common market space; there is little product differentiation. The company’s market analysis shows it prefers to segment, target, and appropriately position its market (Gerdeman, 2011). The company has three segments; Sam’s club, International stores, and Wal-Mart Stores. This paper highlights Wal-Mart’s market characteristics, revenues, competition, and customers.
Market Strategy
The company’s market strategy is diverse; different strategies that cover various aspects such as culture, beliefs, tastes, and needs are integrated by Wal-Mart (Gerdeman, 2011). The company uses positioning, targeting, and segmentation to understand the various characteristic of its market and respond adequately to demands. Besides, Wal-Mart also enjoys a competitive advantage over its rivals by low pricing, brand assortments, and soundness of its supply chain (Gerdeman, 2011). The company also analyses accurately its competition and markets, which aids it in making investment decisions. Wal-Mart has also perfected its innovative information system and distribution that fits its operations. The company has a mobile app that works on both iPhone and Android (Walmart Inc. n.d.). Other customers can access similar services and information on Walmart.com. This has increased productivity and efficacy since Wal-Mart can trace inventories with their excellent telecommunication and distribution structure.
Customer Value Proposition
Wal-Mart attempts to achieve its customer’s value propositions in two ways; low pricing and satisfaction (Walmart Inc. n.d.). The company has an efficient supply chain system that ensures inventory deliveries are timely. The efficiency of Wal-Mart’s e-commerce system also satisfies their customers as much as store services (Ghemawat et al., 2006). The company also values its customers by pricing its goods relatively cheaper than its competitors. To achieve this, Wal-Mart needs to reduce operational costs, such as wages and salaries of its employees. The company has succeeded by having enough employees at stores and improving its efficiency (Bhasin, Garmon, Tanja & Maute, 2017). The result is improved distribution, cheaper costs, and efficient inventory management, which allows the company to sell at discounted prices.
Revenue models
Wal-Mart revenues originate from direct sales of services and products to other businesses and final consumers (Bhasin et al., 2017). The product revenues come from home products such as houseware, appliances, décor, and bedding. Other product categories include grocery, pharmaceuticals, clothing, and jewelry (Walmart Inc. n.d.). Walmart also sells entertainment products such as cameras, toys or electronics, and hardline commodities like automotive, paints, and fabrics (Walmart Inc. n.d.). The company generates its service revenues from financial, clinical, and health insurance services. Another service of Wal-Mart is a movie streaming on VUDU.
Competition
In the e-commerce setting, Wal-Mart Company faces competition from other market players such as Amazon, Costco, Kroger, Tesco, Best Buy, Target, and Walgreens (Bhasin et al., 2017). However, the success of Wal-Mart can be attributed to its competitive advantages over other market participants. Wal-Mart uses a unique selling proposition (USP), selling at low prices at all chain levels. On Black Fridays, the company offers products and services at non-returnable prices. The company also has broad assortments of commodities, which gives it the ability to sell at lower costs and make huge profits since it keeps most of its customers. The other competitive advantage of Wal-Mart Company is sound operation and supply chain management (Bhasin et al., 2017). Customers get inventories as quickly as possible while shelves are always full; this gives Wal-Mart an edge over its e-commerce rivals.
References
Gerdeman, D. (2011, October 20). Getting the Marketing Mix Right. Retrieved from https://hbswk.hbs.edu/item/getting-the-marketing-mix-right
Walmart Inc. – E-commerce Website, Save Money. Live Better. (n.d.). Retrieved from https://www.walmart.com/
Ghemawat, P., & Mark, K. A. (2006, August 23). The Real Wal-Mart Effect. Retrieved from https://hbswk.hbs.edu/item/the-real-wal-mart-effect
Bhasin, H., Garmon, C., Tanja, & Maute, R. (2017, December 17). Marketing Strategy of Walmart – Walmart Marketing Strategy. Retrieved from https://www.marketing91.com/marketing-strategy-walmart/