Walmart is in the news “bigly” as we say in the US. It’s time to take a look at where Walmart is today, where it’s going in-store and online, and how it’s doing in the digital battle to defend itself from Amazon. The biggest Walmart news is value-investor icon Warren Buffett divesting $900 million – the rest of his holdings of the global department store chain. MSN analysts wonder if this is the death knell for retail and what it means for the future of bricks and mortar stores?
Amazon’s online sales were $107 billion while Walmart’s online sales were just $13.7 billion in 2015, Walmart’s purchase of Jet.com last year is a bold attempt to strengthen its e-commerce business but it seems to be over-stored and will need to remake itself into a coordinated omni-channel retailer.
That strategy may be playing out as Walmart announced the purchase of Moosejaw for $51 million today. This top outdoor online retailer also has 10 bricks and mortar stores in the US and it will continue to operate as a separate entity. Both should benefit from the acquisition. In the first week of January, Walmart also acquired ShoeBuy.com for $70 million in what was considered a smart acquisition to complement their $3 billion purchase of Jet.com early in 2016.
At the end of January, Walmart made another strategic move against Amazon, dropping its Prime-like $50 membership program in favor of free delivery on orders over $35 and promising more e-commerce innovations ahead. In groceries, Walmart has a clear lead in scale over Amazon but the Seattle company is testing many new retail concepts. In the growing digital race, Walmart introduced its Scan and Go app for Android to speed up checkouts.
Camillus, NY could be Walmart’s first test of online ordering and curbside pickup in its 116 New York stores, although curbside pickup is only 2% of grocery sales in the US. Groceries currently make up 56% of Walmart’s sales. IBM is working with Walmart to test blockchain technology in grocery products in the US and China. Walmart increased its stake in Chinese e-commerce firm JD.com Inc. to 12.1% as of the end of 2016. Finally, Walmart is committed to cutting its greenhouse gas emissions by 18% by 2025, compared to 2015 levels.
Warren Buffett just dropped Walmart and signaled the death of retail as we know it
Warren Buffett’s Berkshire Hathaway just sold off $900 million of Walmart stock, choosing to invest billions in airline stocks instead.
The sale, which leaves Buffett with nearly no shares in Walmart, comes as America’s largest traditional retailer has rushed to catch up to Amazon and other online competitors. Amazon’s market value is now $356 billion, compared with Walmart’s $298 billion. Buffett last year acknowledged that traditional brick-and-mortar retailers were struggling in the face of competition from the e-commerce giant.
“It is a big, big force and it has already disrupted plenty of people and it will disrupt more,” Buffett said at his annual shareholders’ meeting in 2016, according to Bloomberg. Buffett’s been paring his stake in Walmart since then. He first bought shares in the retailer back in 2005. Via msn.com
Wal-Mart buys Moosejaw for $51 million
The Moosejaw deal expands Wal-Mart’s reach in the outdoor gear space. Moosejaw sells more than 400 brands online, including Patagonia, The North Face, Garmin and others. The company also manufactures its own private-label apparel and gear. “Apparel and accessories is now the No. 1 category for digital commerce, according to comScore, and we gain the experience of another well-established e-commerce player, this time in the active outdoor category,” Wal-Mart said.
Moosejaw generated an Internet Retailer-estimated $97.2 million in online sales in 2015, up 16% from $83.8 million the previous year, according to Internet Retailer’s Top500Guide.com. Moosejaw’s year-over-year growth rate of 16% outpaced all other sporting goods retailers in both the Top 500 (13.3%) and the U.S. Top 1,000 (13.6%). Via Internet Retailer
Walmart buys Shoebuy for $70 million to bolster Jet.com
Wal-Mart Stores Inc. has accessorized its recently acquired online marketplace Jet.com by buying it one of the largest shoe e-retailers in North America.
Wal-Mart, No. 4 in the Internet Retailer 2016 Top 500 Guide, today announced it bought online shoe and apparel retailer ShoeBuy.com Inc. (No. 101 in the 2016 Top 500) for $70 million. The deal will help expand Jet’s apparel and footwear selection, Wal-Mart writes. The move comes 11 months after Jet acquired home furnishings e-retailer Hayneedle Inc. to boost its indoor and outdoor home furnishings assortment. Wal-Mart acquired Jet.com in a $3.3 billion cash and stock deal in August.
This deal appears to be as much for ShoeBuy’s talent and brand name as its product assortment. Via internetretailer.com
Walmart’s Free Shipping Escalates Battle With Amazon Prime
Walmart just fired another shot in the war with Amazon by killing off its Prime-like subscription service to offer free two-day shipping on all orders.
Walmart launched a program competitive to Amazon Prime last year called ShippingPass for a $50 annual fee. But it didn’t have many of the same perks as Amazon Prime such as streaming media and e-book lending.
As of this morning, the minimum purchase required for free shipping to homes is $35, down from $50. Some 2 million items are eligible. Walmart offers just a fraction of Amazon’s 40 million products plus extras such as streaming media and original content. But this is just a start, according to Marc Lore, president and CEO of Walmart U.S. eCommerce. Via forbes.com
Walmart Amps Up Grocery Competition Vs. Amazon
The battle between Amazon and Walmart is heating up as Walmart moves to embrace digital channels even further into the grocery shopping experience, Forbes reported.
The company has brought the Scan and Go app to Android users (after an initial availability for iPhone users), with testing underway at one store and an aim at other stores eventually. That Scan and Go process is geared toward smoothing the checkout process. As the name implies, users can scan items even as those items are being dropped into shopping carts. Payment is also done through the app. Upon showing payment receipts on the phone itself, customers are free to leave the store post purchase. Forbes said the Android availability means that the company is broadening its digital appeal.
The competitive landscape is heating up as Amazon Go is making some headway in the physical shopping experience, as consumers shop in-store and exit via app. The process is still a bit different as Forbes stated that the Walmart offering has manual scanning in place, followed by payment and then showing the digital receipt. Via pymnts.com
CNY Walmart could be first in NY to offer online grocery ordering, curbside pickup
The Walmart in Camillus could be the company’s first store in New York state to offer online grocery ordering with pickup at the store.
The Camillus Planning Board Monday approved Walmart’s request to build a canopy with a dedicated grocery pickup spot on the west side of its store at 5399 W. Genesee St. The changes will accommodate customers who order their groceries online and then come to the store at a designated time to pick them up.
None of the 116 Walmart stores in New York currently offer the service, the company said in an email Tuesday. The company did not say when the service will begin in Camillus. The market for online grocery ordering is small. Researchers told The Washington Post that ecommerce represents 2 percent or less of grocery sales overall. Via syracuse.com
PG Web Extra: Walmart Adopts Blockchain Technology
As new business technologies come on the scene, even in nonretailing industries, food retailers should pay close attention to how these solutions could benefit their supply chains, according to Paul Chang, global supply chain subject-matter expert at Armonk, N.Y.-based IBM. That’s exactly what Bentonville, Ark.-based Walmart has done by launching a test with blockchain, a database technology that has already been in use in the financial services industry for several years. IBM co-developed the technology being used in the experiment.
Blockchain is essentially a digital ledger system that lets all parties involved in business – including growers, distributors and retailers in the grocery industry – record their transactions securely in the cloud. Walmart is interested in seeing how the technology could improve the safety and security of fresh food in its supply chain.
Perhaps most promising of all, blockchain presents a new level of trustworthiness, since the data that are recorded can’t be easily changed or reversed. “I think Walmart was intrigued by blockchain because it creates this network of trust,” explains Chang. In the U.S. market, Walmart is testing blockchain with a packaged produce item, and in China, its test is with pork. Via progressivegrocer.com
Walmart Ups JD.Com Stake To 12% To Deepen China Partnership
U.S. retail giant Wal-Mart Stores, Inc. has increased its stake in Chinese e-commerce firm JD.com Inc. to 12.1% as of the end of 2016, up from 10.8% last October, deepening its partnership with China’s second largest online shopping platform behind Aliababa, according to a securities filing.
In a six-month period, Walmart has more than doubled its shareholding in JD.com from 5.9% last June, when the two companies struck a wide-ranging partnership. In that agreement, Walmart sold its fully owned Chinese e-commerce player Yihaodian to JD.com Inc. in exchange for receiving a 5% stake in JD.com worth roughly US$1.5 billion.
Walmart is betting on JD.com as a major e-commerce channel for its future in China, where consumers are projected to spend up to US$6.4 trillion a year by 2025. Via chinamoneynetwork.com
Walmart: ‘It doesn’t matter who occupies the White House’
On Nov.4, just a few days before the U.S. presidential election, the science-based targets movement officially went mainstream. It was the date the world’s largest retailer, Walmart, announced an emissions reduction plan approved by the Science Based Targets Initiative (SBTI) to cut greenhouse gas emissions by 18 percent by 2025, compared to 2015 levels, and source 50 percent renewable energy by the same date.
Walmart was just the 26th company to get the seal of approval from the SBTI, and the first retailer to secure the accolade. It was seen as a major coup for the SBTI to land the world’s largest retailer less than two years after the scheme’s launch, but why was Walmart so keen to jump on board?
It was the “increased emphasis” in the corporate world on science-based targets, including from its own suppliers, that convinced Walmart to take the leap, Fred Bedore, senior director of business strategy and sustainability at Walmart, told BusinessGreen. Via greenbiz.com
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