Case Study: Walmart - Brick&Mortar to E-Commerce

Topics: Wal-Mart, Electronic commerce, Target Corporation Pages: 5 (933 words) Published: October 14, 2014


Walmart was established in 1962 in Rogers, Arkansas. Since then, Walmart has grown to one of the largest companies in the world, opening thousands of stores across the United States and other countries. Through innovation, they strive to bring a seamless experience to let customers shop anytime and anywhere online, mobile devices and in stores. Overall, Walmart operates over 11,000 retail unites under 71 banners in 27 different countries and e-commerce websites in 10 countries. A total of 2.2 million associates worldwide work for Walmart. Over the recent years however, other companies like Amazon have come into play, forcing Walmart to make the switch to having a strong E-business model. (Walmart, 2014) Walmart still stands tall in terms of overall revenue compared to the online giant Amazon, bringing in $473 billion total revenue compared to Amazon’s mere $60.3 billion. This doesn’t mean that Walmart is not concerned however with the amount and quality of their online sales, being outsold by Amazon online seven to one last year. This is a big deal because E-commerce in the U.S. grew about six times the rate of the normal rate over the previous year. (Davidson, 2014) It was in the summer of 2011 when Jeremy King was hired as the CTO of Walmart.com by none other than Mike Duke, the CEO of Walmart. All of this came about after a meeting between King and Duke occurred, where Duke swore that the digital was now a priority for Walmart. Duke had restructured the company, placing E-Commerce on the same level with Walmart’s other, much larger divisions. Duke was looking for people who could help revive the company’s sites and services. This included purchasing a 65 person social media firm called Kosmix, which had experience in search and analytics. Walmart themselves even renamed their division in Silicon Valley “Walmart Labs”, which is now housed in a boxy office tower in San Bruno, California. In just over a year, it helped Walmart.com revamp its search engine and this past fall launched a test to offer customers same day shipping. These changes already show a clear signal of Walmart’s serious intent to compete in the digital E-commerce. (Manjoo, 2014)

Walmart is already taking strides to implement and improve existing or new online services. Walmart.com over the last few months has been getting updates that customers may have already been using, due to Walmart rolling out the updates gradually. Walmart.com will also be introducing a new customer recommendation engine that serves users with customized product suggestions based on past searches, purchase history, and location. The experience even extends to the brick and mortar stores by showing the customer deals and coupons they can use at any nearby Walmart store locations. (Davidson, 2014)

Another big help to Walmart improving their E-commerce and business was the purchase of the Kosmiz team, now Walmart Labs, mentioned earlier. After creating Walmart’s new search engine in just 10 months, Walmart Labs started to work on new ideas and experiments. One of these first projects was called Shopycat, which was a gift recommendation app that Walmart.com launched on Facebook before the 2001 holiday season. What this app did was scan a user’s friends’ profile to identify interesting gift ideas from their stream of likes, comments, and status updates. Even taking it as far to know if “Ted” meant the geeky ideas festival or the stuffed animal from Seth McFarlane’s movie. In 2012, Shopycat was reformatted to be a part of Walmart.com itself, renamed “Walmart Gifts”. Another clever application of Walmart Lab’s was the use of spikes in social networks chatter to predict demand for an out of the ordinary product. Last year, the algorithms anticipated a customer interest in cake pop makers based on what they were seeing from social networks. (Manjoo, 2014)

By themselves, none of these projects will single handedly boost Walmart’s E-commerce business. Together however, they...


References: Davidson, J. (2014, August 4). 3 Ways Walmart Is Trying to Out-Amazon Amazon. Retrieved from Time: http://time.com/money/3079546/walmart-out-amazon-amazonfresh/
Manjoo, F. (2014). WALMART 'S EVOLUTION FROM BIG BOX GIANT TO E-COMMERCE INNOVATOR. Retrieved from Fast Company: http://www.fastcompany.com/3002948/walmarts-evolution-big-box-giant-e-commerce-innovator
Neff, J. (2014, November 14). Walmart Brings Bricks and Mortar to Battle with Amazon. Retrieved from Advertising Age: http://adage.com/article/digital/walmart-brings-bricks-mortar-battle-amazon/230986/
Walmart. (2014). Our Story. Retrieved from Walmart: http://corporate.walmart.com/our-story/
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