Amazon and Walmart are the two leading retail companies. Walmart’s growth is a direct result of its supply-chain innovation, which led to efficiency in their product distribution. Both rivals are competing to be the leading player in retail. Amazon’s and Walmart’s success strategies are to acquire smaller firms. Amzon bought Whole Foods, America’s largest organic supermarket, Pill Pack a pharmaceutical firm that simplifies ordering and receiving life-saving medication and Ring in order to expand the home surveillance and security business. Walmart purchased Jet.com in order to expand their e-commerce customer base. Also, they bought Shoebuy and Bonobos to expand into the apparel and beauty industry.
Amazon made many mistakes on its quest to become America’s largest retailer. Amazon’s flagship phone, the Amazon Fire, only sold fifty thousand units globally. The company was forced to discontinue their phone due to poor sales. Walmart’s acquisition for $3 billion of Jet.com was an overvalued deal, as the company was only a few years old and a startup. Walmart may not be able to meet its ambitious expectations for the e-commerce sector. Amazon has a strong advantage in this contest as it is a major player in the online retail industry, while Walmart is transitioning to an online-only business model.
Jeff Bezos was the founder of Amazon in Seattle Washington on 5 July 1994. Tech giant Amazon is the second-largest Internet retailer after Alibaba Group, as measured by market capitalization and revenue. Amazon has taken over the online retail industry, accounting for a whopping 44% in 2017 of US sales. Amazon has directly and indirectly created over 1.7 millions jobs in the world. Amazon has created 130,000 Amazon jobs directly in 2017. This is not counting acquisitions. With this, the total number of employees worldwide now exceeds 560,000. Amazon Prime helped it ship over five billion products in 2017.
Walmart Inc. operates a multinational American retail corporation with headquarters in Bentonville Arkansas. Walmart Inc. also operates a network of hypermarkets as well discount department stores and grocery store. Sam Walton founded the company in 1962. Walmart has 11,718 clubs and stores in 28 nations. Fortune Global 500, 2018’s list of Fortune Global 500 companies, shows that Walmart has a revenue of over US$500billion. With 2.3m employees it is also the largest employer in the entire world. The Walton family owns the publicly-traded company. Walmart was in 2016 the largest U.S. supermarket chain, with 62.3 percent (US$478.614 Billion) of its sales coming from U.S.-based operations. Charles Fishman, the author behind the book The Walmart Effect, noted that Walmart alone is responsible for 2% of US GDP. Amazon and Walmart have a retail rivalry. Retail has many components. Clothing and apparel is one component. Other components include groceries, electronic goods, pharmaceuticals, beauty and style, and clothing. There has been fierce competition to this end.
Walmart has been a leader in retail for many decades. It is now one of the biggest companies on the planet. This was achieved by creating a complex and efficient logistics system. Walmart is able to reduce costs because they use their own trucks to transport the goods from their warehouses into their stores. Walmart has been able to lower prices on goods. Amazon has recently taken the lead in e-commerce retailing, displacing Walmart. Amazon appears to have a stronger momentum. Amazon’s market shares are increasing as consumers move to online shopping. But. Amazon would find it easier to expand their physical presence than Walmart. Each company’s or group’s key strategy success; Amazon has achieved its success because of the strategy they have adopted to not own physical retail shops. The company invests the money they’ve saved in research and technology.
They have innovated in the logistics sector
Amazon’s strategy has changed over the last two decades. From an online retailer, it is now a B2B provider of services, providing a number of essential infrastructures as a service. Amazon Prime’s free 2-day shipping is a big marketing hit. Amazon Prime has now reached 100 million subscribers. Technology is used to boost margins. To improve their efficiency, they use thousands of robots. Amazon Web Services is the cloud-based business of Amazon that has driven its growth in recent times. AWS has been the driving force behind Amazon’s growth for the past few years. Amazon has been the platform of choice for small and medium businesses in the United States. Over 300,000. It shortened the time it took to reach the market and generated billions in revenue.
Amazon also bought ring, which is a smart-doorbell that streams video and audio to phones. The deal was worth about $1 billion. They plan to expand in the surveillance and home security business. This purchase was made in order to eliminate the theft of many packages from customers. Customers are still hesitant to give a company the right to enter their homes at any given time. Amazon’s data collection through audio and videos streaming is also a privacy concern. Amazon’s ad revenue is small compared to Google’s and Facebook’s, but it is on track to be the third-largest ad company in the U.S. in 2020. Walmart acquired Jet.com, Shoebuy, Moosejaw, Modcloth, Bonobos, Modcloth, Modcloth, Modcloth, Modcloth, Bonobos, Parcel, in August 2016. Prices are adjusted in real-time based on the products that customers have in their shopping cart.
Shoebuy, Inc. sells footwear, bags, accessories, apparel, and other products online to women, men, kids, and international customers. Boston, Massachusetts, is where the company is located. Shoebuy.com, Inc., a subsidiary Jet, Inc., has been operating as a company since December 30, 2016. The Moosejaw, edgy outdoor gear, will now be featured in Walmart’s online store. Walmart purchased the company in 2017. Moosejaw and the other companies Walmart purchased in recent years target millennials. Walmart said that it wanted to focus more on this group, given their greater purchasing power. Both companies and groups made strategic mistakes. Walmart’s Jet.com acquisition has not had much of an impact on the online retailer sector.
Amazon’s venture into the electronics market was a flop. The public did not like their flagship phone, Amazon fire, or their E reader. The agreement with AT&T for the sale of its phones did not attract enough customers. Amaozn discontinued their product in less than 35,000 fire phones. The price of a 32 gigabit smartphone was $200, the same as that of an Iphone 5 & Samsung Galaxy 5 Customers thought that Wal-Mart would disrupt the market by selling hardware at low prices and making money on content. Wal-Mart’s profit margins are down slightly because of aggressive marketing. The retailer is investing heavily in order to maintain its competitive prices. Operating margins have fallen to 3.9 per cent during the third quarter of fiscal year, down from 4.4 per cent a year earlier.
Predictions of the companies that will have an advantage over their competitors in the future. Brick-and mortar retailers are on the losing side of the retail shift to digital. They’re stuck in an unhealthy cycle of declining foot traffic and comparable-stores sales. 8600 brick-and mortar stores are expected to close in 2017. The report states that 2,056 closed stores in 2016, and 5,077 in 2015. The worst-ever year was 2008, with 6,163 store closures. Amazon will be the company to emerge as the winner in a few years. It is because ecommerce is gaining popularity around the globe. Asian countries are adopting e-commerce more than any other country in the world. Alibaba is the world’s largest online retailer. Amazon’s recent market cap reached $1 trillion. Amazon’s competitive advantage is that it has a democratized marketplace, which allows small and large businesses to make millions in sales. For a $40 membership fee, anyone can open an Amazon seller account.
Walmart selects their sellers by hand and they must meet the requirements. For a business to qualify for a Walmart seller, it must be well established. Walmart is therefore unable to accept more sellers.
