3. Problem Statement
Grow online business of
Walmart.com
Diversify in non grocery
market
Maintain competitive
advantage in Grocery
business
Cost leadership
3
5. Porter’s Five Forces
Threat of
new entry
Threat of
substitutes
Threat of
substitutes
Supplier
Power
Buyer
Power
Competitive
Rivalry
High Force
High quality of information
High availability of substitute
products
Low Force
Codes of conduct related to
quality
High Force
Small Capital
Requirement, low
switching cost
Low customer loyalty
Access to the technology
is uniform
Low Force
E-retail and physical
retailers
5
6. 6
Amazon’s Timeline
1994
TO
1995
FOUNDED &
OPENING DAY
1997
SECURE & EASY
INTERFACE,
CUST. REVIEWS,
BOOKS RECOMMEND,
SINGLE-CLICK
“BUY-NOW”,
ACQUIRED IMDB
1999
ZSHOPS
DRUGSTORE.COM
PETS.COM
2005
TO
2007
AMAZON PRIME
AWS
KINDLE EREADER
AMAZON FRESH
2009
ACQUIRED
ZAPPOS
2012
ACQUIRED
KIVA SYSTEMS
2013
TO
2015
PRIME INSTANT VIDEO
AMAZON ECHO
DASH BUTTONS
OPENED AMAZON BOOKS STORE
ACQUIRED TWITCH
2016
AMAZON GO RETAIL
PRIME AIR
2017
ACQUIRED
WHOLE FOODS,
BODY LABS,
7. Amazon – SWOT Analysis
7
W
LACK OF APPEAL TO
RISK AVERSE CUSTOMERS
MARKET PENETRATION
DEPENDS ON ACCESS TO
INTERNET
WEAKNESSES
O
EXPANSION TO
INTERNATIONAL MARKETS
(ASIA, AFRICA, LAM)
DIVERSIFICATION OF
BUSINESS
OPPORTUNITIES
S
FIRST MOVER ADVANTAGE
STRONG BRAND IMAGE
CUSTOMER LOYALTY (PRIME)
MULTIPLE CUSTOMER
TOUCHPOINTS
STRENGTHS
T
OVER-DIVERSIFICATION
SECURITY & CYBER THREATS
HOLDS VAST AMOUNT OF
CUSTOMER DATA
AGGRESSIVE PRICING
STRATEGY COULD BE A
PROBLEM
THREATS
8. 8
Walmart’s Timeline
1962
OPENED FIRST
DISCOUNT STORE
1970
TO
1976
FIRST DISTRIBUTION CENTER
MERCHANDISE ASSEMBLY
CROSS DOCKING
COMPUTERIZED INVENTORY
TRACKING
DATA-DRIVEN STORAGE
OPTIMIZATION
1983
TO
1988
WAREHOUSE BUSINESS
SUPERCENTERS
2000
ONLINE
SHOPPING
PLATFORM
2007
INTRODUCED
FREE INSTORE
PICKUP
2009
WALMART.COM
MARKETPLACE FOR
SELECT VENDORS
2011
TO
2012
ACQUIRED KOSMIX
PROJECT PANGAEA
2016
ACQUIRED
JET.COM
2017
ACQUIRED
BONOBOS, MOOSEJAW
HAYNEEDLE
PARTNERED WITH
GOOGLE, UBER, LYFT, DELY
9. Walmart – SWOT Analysis
9
W
IT COMPETANCE (wrt. AMAZON)
NOT ATTRACTIVE TO UPSCALE
CUSTOMERS
INORGANIC GROWTH
STRATEGY
LIMITED CUSTOMER
TOUCHPOINTS
WEAKNESSES
O
RETAIL GROWTH IN EMERGING
MARKETS
ONLINE SHOPPING
ESTABLISH STRATEGIC ALLIANCES
EXPLORE INNOVATIVE MODELS TO
ENHANCE CUSTOMER SERVICE
OPPORTUNITIES
S
SCALE OF OPERATIONS (US &
INTERNATIONAL – 6300+ STORES)
ESTABLISHED VENDOR ALLIANCES
STATE OF ART SUPPLY CHAIN
NETWORK
REPUTATION AS DISCOUNT STORE
STRENGTHS
T
STIFF COMPETITION FROM ONLINE
& OTHER RETAIL COMPETITORS
THREAT FROM LOCAL
COMMUNITIES
THREATS
10. 10
Why some Platforms thrive and Others Don’t
AMAZON – STRONG POINT
(STRONG VALUE OF DOING BUSINESS ON AMAZON)
WALMART – NO VALUE ADDITION PROVIDED
RISK OF DISINTERMEDIATION
VULNERABILITY TO MULTI-HOMING
AMAZON – RISK (MINIMIZED BY AGGRESSIVE
COMPETITIVE STRATEGIES)
WALMART – RISK (MINIMIZED BY COST
LEADERSHIP STRATGEY)
AMAZON – STRENGTH
(EASY TO ADD 3RD PARTY + EST. CUST. REVIEWS)
WALMART – NEEDS TO IMPROVE
STRENGTH OF NETWORK EFFECTS
NETWORK CLUSTERING
AMAZON – STRONG POINT (GLOBAL SCALE)
WALMART – NEEDS TO IMPROVE
(THOUGH GLOBAL, ACTS LIKE LOCAL CLUSTERS)
AMAZON – STRENGTH (MULTIPLE CUSTOMER
TOUCHPOINTS)
WALMART – RISK (NEEDS TO IMPROVE)
NETWORK BRIDGING
20. Key Takeaways
20
• Customer touch points ( Google home /Uber)
• Segmentation basis age , geography and income
• Expand customer base : product, pricing and promotion ( This
will help to grow as platform)
Marketing
Strategy
• Sales mix:56%
• Retained earnings for marketing and distribution
Grocery market
advantage
• Inorganic growth strategy.
• Develop multiple partners like Google and Uber
• Efficient expansions in domestic and other markets
Acquisitions &
Platform sharing
• Resource optimization: fulfilment centres
• Last mile delivery: developing own infrastructure rather
depending on 3rd part Uber and others
• Walmart pharmacy last mile delivery
Distribution
