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James B. Stewart writes in the NYT that for the past 16 years Walmart has often acted as though it hoped Amazon would just go away. When Walmart announced last week that it was significantly increasing its investment in e-commerce, it tacitly acknowledged that it had fallen far behind Amazon in the race for online customers. Now, the magnitude of the task it faces has grown exponentially as e-commerce growth continues to surge globally. "Walmart.com has been severely mismanaged," says Burt P. Flickinger III. "Walmart would go a few years and invest strategically and significantly in e-commerce, then other years it wouldn't. Meanwhile, Amazon is making moves in e-commerce that's put Walmart so far behind that it might not be able to catch up for 10 more years, if ever."
In 1999, Amazon was a fledgling company with annual revenue of $1.6 billion; Walmart's was about $138 billion. By last year, Amazon's revenue was about 54 times what it was in 1999, nearly $89 billion, almost all of it from online sales. Walmart's was about three times what it was 15 years before, almost $486 billion, and only a small fraction of that — 2.5 percent, or $12.2 billion — came from Walmart.com. Walmart's superefficient distribution system — a function of its enormous volume and geographic reach — was long the secret to Walmart's immense profitability. Ravi Jariwala, a Walmart spokesman, says that Walmart is building vast new fulfillment centers and is rapidly enhancing its delivery capabilities to take advantage of its extensive store network to provide convenient in-store pickup and adds that 70 percent of the American population lives within five miles of a Walmart store. "This is where e-commerce is headed," says Jariwala, which is to a hybrid online/in-store model. "Customers want the accessibility and immediacy of a physical store," along with the benefits of online shopping.
(Score: 3, Insightful) by VLM on Sunday October 25 2015, @12:00PM
immediacy of a physical store
Clearly there's someone who's never shopped at a real walmart. The checkout lanes are managed to keep them about 10-15 minutes long, longer during christmas. Something to do with transaction costs and intentionally preventing the store from being used as a convenience store while maximizing the labor extracted from cashiers.
When I go to Nordstroms I feel the social pressure to dress up a bit, maybe shave and shower first, wear something clean if I've gotten dirty from yardwork or exercise, etc. I can assure you, people don't dress up to online shop OR walmart shop. I can do without this factor of the "walmart immediacy" having to stand in line for 15 minutes smelling someone who's apparently homeless.
Anyway online is generally more immediate, I can pick up my phone and do the whole process of ordering and complete the transaction and have email confirmation faster than I can get the kids ready and in the car to go to walmart, heck, faster than I can get ready and get in my car, sometimes. Not so much a high maintenance thing as the amazon app is so fast, I can order something in a minute if I'm in a hurry and know exactly what I need.