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www.WebWholesalerMagazine.com CURRENTS Clash of the Retail Titans
THERE WAS once a time when Walmart and Amazon grew simultaneously, serving diff erent demographics and merchandising needs. T ere was no real concern for the mega brick and mor- tar retailer to fear the dominance of the web and a huge online competitor like Amazon. Currently, Walmart’s dominance is faced with a shiſt in trends. First, the discount store’s traditional customers, bar- gain hunters making less than $50,000 a year, are becoming more tech-savvy. Secondly, as the reces- sion subsides, more affl uent shoppers who began frequenting Walmart during hard times are return- ing to Amazon. Further analysis from the San Francisco Chron-
icle also shows that Amazon has moved into mer- chandise categories similar to Walmart’s current
off erings, from diapers to vacuum cleaner bags. According to research fi rm Kantar Retail, “In its last fi scal year, Amazon posted 41 percent revenue growth, to $48.1 billion, while Walmart saw just eight percent growth. T e chain’s 2011 online sales amounted to less than two percent of its $264 bil- lion in U.S. revenue.” To combat the inevitable, Wal- mart has increased its investment in online business, spending more than $300 million to acquire fi ve tech fi rms since May 2010. T ere are also plans for a program that will allow the 20 percent of Walmart customers without credit cards or bank accounts to make purchases online. Walmart is prepared for bat le with its web based shopping tactics.
T is article is adapted f om a piece by the San Francisco Chronicle.
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May 2012
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