Walmart needs more than Wlamart+ TO CHALLENGE aMAZON

Walmart has no other option but to compete- to survive

If you are Walmart, you are in quandry at this cricial juncture (year 2020).

It did not take the race seriously when it started. By the time it realized that the winner takes it all and it got to the start line, the competitor had already run several laps, leaving all others running the race far behind.

Walmart is a retailer. Amazon is not ! Wamart is working on evolving into Omnichannel company. Amazon is not an Omnichannel company either. With Walmart+, Walmart will challenge Amazon into eCommerce fulfillment foray. Amazon is not an eCommerce fulfillment services either.

Amazon….is an ecosystem !

Walmart has no other option but to keep competing with Amazon and so it HAS TO keep launching products like Wamrt+. Continuously stepping up its game is the only way for it to keep Amazon at bay. Not that Amazon wants to accquire Walmart- Amazon would rather love to see it go down into the ground.

When FedEx was going through a challenging time, Amazon decided to terminate its relationship with FedEx, and announce it with media fanfare to make it more difficult. They were dabbling into Logistics services and in my opinion, Amazon’s strategy with competitors is brutal- push them into a corner and demoralize them so much that they mentally (and publicly) lose the war with you. This is supported by one of the most proficient “innovation Marketing” department in the world. With Amazon, you can never show that you are on the defensive. As soon as you do that, Amazon will smell the bIood.

I have previously indicated how Walmart’s huge retail footprint provides it an opportunity to challenge Amazon in eCommerce. That will ensure that Amazon can not push it to face the fate many retailers have faced since Amazon came out “all guns blazing”. But to actually challenge Amazon, as a company, the strategy can NEVER be the catch-up strategy.

Amazon is no longer a company- it is an ecosystem now

People are already complaining that streaming services are not included in the offering. And some other cribs people have are the minimum order quantity of $35 etc.. In my perspective, most customers are not appreciative of the fact that the subscription costs less as well. The key challenge that Walmart needs to tackle is:

Amazon has created a habit forming ecosystem of products and services. It has people hooked!

So the war has evolved much beyond delivery and Supply Chain. If you have not read the bestseller, you must read the book “Hooked” by Nir Eyal. The book, specially useful for Marketers and Product managers, illustrates how you can build habit forming products and services.

And Amazon has been doing that for decades now !

It has created an unrivaled ecosystem of products, Digital products and services that essentially “weave” Amazon into its customer’s lives. It IS habit forming. And at this point, no company, not even Walmart, can play a catch-up game with that ecosystem.

If you really want to challenge Amazon (not just protect your turf from them), you have to foray into areas where they currently are not there, leveraging three aspects- your core competency (in case of Walmart, its retail footprint), Digital products, Hardware bots and services. And this combination can help you creat many unique offerings, some of which may not be successful but even if you launch ten and strike home with two, you have opened a new war turf.

War games and Chess strategies have few common strategies. One is that if you believe that the enemy is overwhelming you in one direction, you open another front that the enemy must pay attention to. Walmart+ is not that. It is essentially “we have it too”. While I see that this may prevent attrition of regular Walmart shoppers, who may have explored eCommerce during the pandemic, to swing towards Amazon, it may not have the potential to break the “habit” of existing Amazon customers, who are used to the largest ecosystem built by one organization.

There are few areas that Walmart can potentially explore to create new War turfs for Amazon but I am not sharing them here since I am pretty sure they are already being thought upon by much smarter people at Walmart.

Hopefully we will see Walmart draw Amazon into a turf that catches Amazon by surprise.


Views expressed are my own.

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