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Justification of selection via comprehensive arguments:
1. Wal-Mart giant retailer in America, reasons why can’t manage to get top dog e-commerce
2. To offer same pattern in Pakistan for brick & mortar stores.
Wal-Mart's milestones began in 1962 when the first Wal-Mart was opened in Rogers, Arkansas. Seven years later the company incorporated as Wal-Mart Stores, Inc. Then a year later they opened the first distribution center and home office in Bentonville, Arkansas, and also went public on the New York Stock Exchange. Several years later, in 1988, the first super center was opened. Then in 1991, the first international unit was opened in Mexico City. By the turn of the century, Discount Store News had named Wal-Mart "Retailer of the Century" and made Fortune magazine's lists of the "Most Admired Companies in America" and the "100 Best Companies to Work For." They were also ranked on Financial Times' "Most Respected in the World" list. In 2002, Wal-Mart became number one on the Fortune 500 list and was presented with the Ron Brown Award for Corporate Leadership, a presidential award that recognizes companies for outstanding achievement in employee and community relations. Wal-Mart is currently at no.8 at global 2000 companies rating in Forbes magazine. Wal-Mart creates the ideal one-stop shopping experience. Wal-Mart is organized into ten distinct divisions. These include: Wal-Mart stores, SAM'S CLUBS, Neighborhood Markets, International, walmart.com, Tire & Lube Express, Wal-Mart Optical, Wal-Mart Pharmacy, WalMart Vacations, and Wal-Mart's Used Fixture Auctions. Through these divisions, Wal-Mart offers thousands of products. The Wal-Mart stores contain groceries, clothes, healthcare products, toys, electronics, bedding, sports and recreation, automotive, among other items. Because of this conglomeration of products, the typical consumer can go into any Wal-Mart and walk out without having to stop at another store for anything that they could need. Key numbers for fiscal year ending January, 2009: Sales: $401.2 Billion One year growth: 7.2%
Net income: $13.4 Billion Income growth: 5.3% Wal-Mart Stores (Wal-Mart or ‘the company’) is the largest retail company in the world; it operates retail stores in various formats including supercenters, discount stores and neighborhood markets. On January 31, 2008, Wal-Mart operated 891 discount stores, 2,612 supercenters, 153 neighborhood markets and 602 Sam’s Clubs in the US & units outside the United States 3,615. Internationally, the company operated units in Argentina, Brazil, Canada, Costa Rica, El Salvador, Guatemala, Honduras, Japan, Mexico, Nicaragua, Puerto Rico, the UK and China. The company is headquartered in Bentonville, Arkansas and employs about 2.1 million people. Net sales in fiscal 2009 were a record $401.2 billion, Up 7.2% from fiscal year 2008 Sam’s Club International Wal-Mart U.S.
Wal-Mart’s three business 12% Stores, Sam’s Its Wal-Mart 24% largest segment 64% business, its net sales, ended January and operates formats in the Wal-Mart’s online retail operations, walmart.com.
11.80% 24.60% 63.70%
Sam’s Club International Walmart U.S.
operations comprise segments: Wal-Mart Club and International. Stores segment is the of the Company’s accounting for 64% of during the fiscal year 31, 2008 (fiscal 2008), stores in three different United States, as well as
Its Sam’s Club segment consists of membership warehouse clubs in the United States and the segment’s online retail operations, samsclub.com. Sam’s Club accounted for 11.8% of the Company’s net sales during fiscal 2008. (Google Finance) Mission Statement Wal-Mart Stores, Inc. does not have a formal mission statement. This is because Kim Ellis, the Public Relations Coordinator, said that they believe the customers are more interested in other aspects of the business, and they, the company, are focused on meeting their basic consumer needs.
It promises unlimited potential for growth and profits. To provide the ease of shopping the industry is guaranteeing that the customers will find what they want when they want it. the industry is focused around the customer. and government An opportunity facing the industry is that the Asian market is virtually untapped by the retail world. To take advantage of internet shopping. . When the government enters into new trade agreements with foreign countries. Technological An opportunity facing the industry is that internet shopping is growing. Political. refunds. This is supported by convenient presentation and the right level of service every time the customer shops. This simply increases the markets available to retailers. businesses in the United States have the ability to offer products from these countries in their stores. cultural. The customer receives friendly site designs. Competitive An opportunity facing the industry is that the value of money is weakening. They process returns. Social. and environmental An opportunity facing the industry is that customers want ease of shopping. By having an untapped market it gives a huge opportunity for companies to expand. The weakening value of money will help the industry because it reduces the ability of foreign manufactures to offer discounts.SWOT External Analysis: Opportunities Economic An opportunity available to the industry is the free trade zone. and rebates quickly. legal. efficient order fulfillment. fast delivery and professional customer response. demographic.
merchandise tagged on the factory floor during manufacture or packaging lets retail employees spend less time in the storeroom applying labels and more time on the show floor helping customers. cultural. legal. products being sold today are gone tomorrow. there is rampant corruption among the Chinese. For one. and environmental threat is employee theft. the Chinese government does not take kindly to opening their country to foreign establishments. Also. Another social. boosting sales significantly. This helps to prevent the two forms of employee theft. Called source tagging. called electronic article surveillance labels. and environmental A threat is customer theft. which are sweat hearting and sliding. This impacts all businesses and causes profit margins to be reduced as price-cutting ensues to attract more consumers. Also. the process offers several major benefits. this provides fewer products for retailers to sell. however. Along with antitheft labels there are radio-frequency circuits that are hidden in packages and go unnoticed. Technological A threat facing the industry is that technological advances may make the products obsolescent. There is no way of preventing it and no way to change it. cultural. inside products and packaging. Social. To overcome the threat of not providing consumers wants the industry is expanding rapidly in the urban centers while . which means they stole it. demographic. Political. and governmental A threat is the Chinese regulations. Competitive A threat is that the industry is not following consumer taste. The only time they will go off is when the bar code scanner does not deactivate the circuit. and they have no generally accepted accounting principles. As technology advances. China has one of the largest populations in the world. high-theft merchandise previously displayed behind glass can now sit out in the open. Manufacturers are fighting back against customer theft by embedding paper clip sized antitheft tags. demographic.Threats Economic A threat is that the economy is very slow right now. Sweat hearting is when the employee charges the customer less than the actual price and sliding is when the employee covers the barcode at the point of sale.
We felt that Wal-Mart's continued expansion into foreign countries to be above average and thus rated it a 3. . 3 = above average response. Weights are assigned to the various opportunities and threats based on how well the subject company is responding to the threats and opportunities.15 for internet shopping. External Factor Evaluation An external factor evaluation matrix identifies the industry-wide opportunities and threats. we rated this as a 4. free trade zones. and . bankruptcy is sure to follow.05 for the weak dollar. If these factors are not addressed by the industry. Wal-Mart's website has been a huge success with it contributing additional revenue to the bottom line. and the value of the dollar. . The response to consumer demand for one-stop shopping has also been a success.10 for the Chinese regulations.10 for technology making products obsolete.10 for Chinese markets. customer and employee theft. The fact that you can buy a vast majority of everyday needs such as groceries.traditional "wet markets" are being edged out as the middle-class enlarges and young people flock to the cities.10 for free trade zones. clothes. Because China is heavily regulated. the Chinese market.10 for ease of shopping. . The opportunities were weighted . The threats were weighted .05 for not offering what consumers want. and customer and employee theft. We also rated this 4. These two factors are paramount to the industry and all of its counterpart's success. The ratings are as follows: 1 = poor response. . and. . We rated each of the opportunities and threats based on how well Wal-Mart has been positioning itself in the market. slow economy. The main threats that we identified were technology making products obsolete. among many other products shows the commitment Wal-Mart is making to the one-stop shopping idea. and 4 = superior response. The weights and are representative of the importance the opportunities and threats presented to Wal-Mart.05 for the slow economy. .20 for customer and employee theft. ease of shopping. we rated their response to the . (Figure 2 in the appendix) The main opportunities that we identified were increasing internet shopping. and not offering what the consumer wants. 2 = average response. electronics. personal care products. They were determined by considering the impact that each one has on the industry and how well Wal-Mart is conditioned to react to the situations presented. the Chinese regulations. We felt that the most important factors were internet shopping.
They have been able to take advantage of this economic factor with ease and we rated it a 3. Wal-Mart suppliers definitely have a great opportunity for sales because of the vast audience that patronize Wal-Mart. because China is such a tough market to enter. We ranked this factor a 4. Wal-Mart solicits feedback from all of their employees. This was ranked as a 2 because Wal-Mart uses the same devices that the entire industry uses. While technology is constantly making products obsolete. They have a number of training tools . We rated this as a 3. Wal-Mart has been able to circumscribe their exposure by offering thousands of products across many different areas. Wal-Mart has been able to position itself to be a positive avenue for selling all of the newest and innovative products.80. We ranked their response to this a 4. In addition. The slowing economy has been a sour point to all industries as well. To that end. diversity and sexual harassment prevention. There have been thousands of products that have flopped after being introduced. The response to threats has been equally impressive. Again. we ranked their response to Chinese regulations a 2. 2. equal employment opportunities. regarding their opinions of their work experience and the company's implementation of Wal-Mart's basic beliefs and values. Internal Analysis: Strengths Management Wal-Mart's policies and practices are designed to ensure an environment that is equitable and inclusive.opportunities available in China a 2. This is still a very good score because it is very difficult for any firm to expand into China. Wal-Mart's reaction to the dollar weakening has been above average because of its worldwide coverage. Wal-Mart has been able to limit its exposure by offering low prices and maintaining its market-leading share. The idea that companies offer products that consumers do not want is not uncommon. Wal-Mart is committed to providing all employees state-of-the-art training resources and development time to help achieve career objectives. they provide training on working with people. that was obtained from the external factor evaluation matrix shows that Wal-Mart is above average when reacting to opportunities and threats. annually. Employee and customer theft is inevitable in all industries. leadership skills. The final score.
distance learning. Finally. park projects. provided money and manpower for fund raisers. skills assessments. school benefits and churches. California. Wal-Mart has been ranked among Training Magazine's 'Top Training 100' companies for two consecutive years. Kansas. Wal-Mart has created Environmental Demonstration Stores in Lawrence. and more. senior citizen centers. Respect for the individual. The management of Wal-Mart is the backbone to the entire company and these core-values have propelled Wal-Mart to the top of their industry and have allowed Wal-Mart to be the world's largest company. raised funds for nearby children's hospitals through the Children's Miracle Network Telethon. food banks. corporate intranet sites. mentor programs. and job announcements. Along this same line. so has the family of Wal-Mart's employees. computer-based learning. They also educate the public about recycling and other environmental topics with the help of a "Green Coordinator. . These also provide a significant amount of compensation to their employees. and City of Industry. More than 15 percent of their employees are over the age of 55. These stores serve as a "test tube" for environmentally friendly building materials and experimental methods for conserving energy and water. With the profit-sharing program. and they are the nation's largest employer of Hispanics and African-Americans. satellite broadcasts. They are allowed to purchase shares of stock at reduced prices. Boy and Girl Scouts. Moore. As the demographics of the nation have changed. Wal-Mart hires locally. and striving for excellence. They have continually gave college scholarships for high school seniors. including classroom courses. which allows them an immediate appreciation of their portfolio.in place that keeps then out in front of the competition." a specially trained employee who coordinates efforts to make an environmentally responsible store. Wal-Mart also uses its respectable financial position to attract and retain employees by offering stock ownership and profit-sharing programs. the corporate structure of Wal-Mart is very well rounded and managed with three core values: respect for the individual. one of Wal-Mart's company's three core values. These tools are successfully increasing advancement opportunities for women and minorities. representing the diversity and uniqueness of everyone's hometown. Oklahoma. police and fire charities. Wal-Mart is committed to the customers and communities they serve. is reinforced throughout their training process. These programs are available to all full-time employees of Wal-Mart and make a significant impact on the earnings of employees. service to their customers. the employees receive bonuses at the end of the year based on the success of the overall company. Wal-Mart also has very strong community-based initiatives.
Stemming from the management's core values. Sam Walton devised a system for which price setting was to be followed. This occurs when WalMart lowers the already lowered Every Day Low Prices. which Sam created known as the "Ten Foot Rule. sports and recreation. which promotes customer goodwill. Wal-Mart maintains one of the best satisfaction guaranteed programs. Sam wouldn't allow management to hedge a price at all. they would mark it up 30 percent. Wal-Mart has been known for their customer oriented approach. but Wal-Mart had paid only 50 cents. they are able to out-price all of their competition. they are required to greet them and ask if they can help them in any way. The Wal-Mart stores contain groceries.Marketing The nature of Wal-Mart's marketing is in its Every Day Low Price (EDLP) campaign. they are always looking for the best deal. Because of this conglomeration of products.98.013 billion and in 2002 their revenue had increased 24% to $217. bedding. This is also evident through employees getting to know customers on a first name basis. SAM'S CLUBS. the typical consumer can go into any Wal-Mart and walk out without having to stop at another store for anything that they could need. Finance/Accounting Since 2000. healthcare products.com. Wal-Mart Vacations. automotive. In 2000. pass it on to the customer. Wal-Mart is organized into ten distinct divisions.799 billion. This has really been a successful way for Wal-Mart to increase its patrons. Wal-Mart offers thousands of products." The other major campaign Wal-Mart employs is the Rollback. They also promote goodwill among consumers by employing a tactic. Top . Tire & Lube Express. if we get a great deal. Through these divisions. perhaps the single most important marketing aspect of Wal-Mart is that they create the ideal one-stop shopping experience. These include: Wal-Mart stores. International. When consumers shop. This is what makes Wal-Mart successful. Wal-Mart Optical. when they rollback prices. since Wal-Mart already offers low prices. Finally. This is astronomical growth in revenues considering the overall size and scope of Wal-Mart. and Wal-Mart's Used Fixture Auctions. Wal-Mart Pharmacy. electronics. nearly no questions asked. If the list price was $1. One can return virtually any product to Wal-Mart without any problems. walmart. among other items. clothes. they had revenues of $165. Sam's philosophy was "No matter what you pay for it. toys. Wal-Mart's revenue has consistently increased." This is simply the idea that if a customer comes within ten feet of an employee. Neighborhood Markets. They simply take the product back and promptly refund the price of the product. and that's it.
. Wal-Mart definitely has the manpower to move goods. and a low inventory. Research and Development Wal-Mart does not engage in any research and development. This system is maintained through the most important aspect of Wal-Mart. an investment in Wal-Mart would perform well. This enables Wal-Mart to take advantage of economies of scale with shipping trucks with full loads. This is also facilitated with a proprietary satellite-based communication system that enables managers and point-of-sale systems real-time information on the needs of each store. only five years later. a faster response to market demands. Wal-Mart more than doubled their net income to $6. The price has fluctuated. This also gives Wal-Mart the ability to increase the speed of deliveries. WalMart uses a system known as cross-docking. The increase in revenues has also been very kind to their cash flow. The strength of Wal-Mart is also shown through its ratios.044 billion and in 2002 this number had increased to a positive $9. Like if Wal-Mart is to open a new store in a city it just goes and open store without any prior research. which is to say that they were able to control their expenses while continuing to grow and expand their operations. Through our ratio analysis. This growth also had an impact on Wal-Mart's net income.961 billion. Wal-Mart had a positive cash flow of $4.be able to consistently grow revenues in such a large organization is simply amazing. and in 2002. This system has allowed Wal-Mart to decrease its sales cost by 2 to 3 percent over the industry. With over one million employees worldwide. In 1997. Nearly all of Wal-Mart's ratios are strengths when measured against the industry averages. but it has only fluctuated between $45 and $65. Figure 4 shows the price of WalMart's common stock from October 2000 until the end of 2002. This savings is then priced into the products with the earlier discussed EDLP programs. (The ratio analysis can be found as Figure 3 in the appendix) Another area of strength is Wal-Mart's stock price.671 billion. Including dividends. their net income was a not-so-paltry $3. Production/Operations Perhaps the strongest aspect of Wal-Mart is in its access to distribution networks. In 1997. its employees. This is simply the process of continuously delivering goods to warehouses where they are sorted and distributed to their stores within one day.056 billion. we have shown that Wal-Mart is the best-equipped company to succeed in the marketplace.
Wal-Mart uses a sophisticated system of satellite-based communications.com/ and do company financial searches. and learn about any recalls of products sold through Wal-Mart. find employment. There are thousands of towns across the United States that have tried to block the introduction of Wal-Mart because of the economic impact that it has on smalltown stores and shops. secure and complete website where consumers can purchase all of the same products found in the store. They are really hurting their corporate image by maintaining this position. and working conditions. Wal-Mart does not have any union involvement. The other area that Wal-Mart lacks in is with unions. Internal Analysis: Weaknesses Management The biggest weakness that Wal-Mart has in the management area is that it does not have a formal mission statement. but it gives a company a statement on which to rely on to stay strong and focused. Wal-Mart has a damaged reputation because when they move into a location they end up "forcing" these types of businesses out of business. With unions. job security is not as much of a concern. Unions are created to provide bargaining power to employees on issues that involve their compensation. This is a problem because of the perception of treating employees poorly. benefits. learn about the grassroots of Wal-Mart.walmartstores. The website is strength because it is not only a means for purchasing products. Currently.Computer Information Systems As discussed in the production/operation section. but is also a very thorough informational site. email the company about problems. While they do have core values. . Consumers can log onto http://www. They also offer a safe. This is also a weakness because of job security. Another weakness is that there are few females in top management and there are few minorities employed. With such a societal demand for equality. Wal-Mart is lacking in this category. This is not a very good ethical decision for Wal-Mart to be making. This is a fundamental aspect of a company and it provides not definition and direction. they do not explicitly tell their employees or consumers what their business is. Marketing The biggest source of marketing weakness stems from Wal-Mart lobbying to expand into new markets.
they do not do any prior site research before opening a store. good reputation. employees. Because more and more people are going to Wal-Mart. and average collection period ratios are not very good. well-rounded business. The average collection period is a cause for concern because it means that they are allowing their debtors to carry accounts with Wal-Mart for an above average period of time. and the number of checkout lines is staying constant. (Figure 5 in the appendix) The key strengths we identified were financial position.Finance/Accounting Weaknesses in Wal-Mart's finances are seen in three of its ratios. 2 = average response. They simply approach a local government and build. However. customer oriented. one-stop shopping. and favorable . This is not good because it increases the likelihood of non-payment. (These ratios can be found in Figure 3 of the appendix) Production/Operations The largest source of concern for this functional area is the slowing speed of checkout lines. This is simply a product of Wal-Mart's success. They are basically losing sales due to this fact. ease of website. Specifically. The fixed asset turnover ratio is telling us that they have made a lot of investments. earnings per share. this is most likely due to the sheer number of outstanding shares. Computer Information Systems We did not find any weaknesses in Wal-Mart's computer information systems. employee stock ownership and profit-sharing. The fixed asset turnover. The ratings are: 1 = poor response. but that they are not being fully used at this point in time. Internal Factor Evaluation The internal factor evaluation is used to evaluate the major strengths and weaknesses of a company. This is a problem because it can and will cause people to choose other stores that are less congested. and 4 = superior response. the only way to compensate is for the time to checkout increase. satisfaction guaranteed programs. Research and Development This is a weakness because they do not actively engage in any research and development. 3 = above average response. There are weights assigned to strengths and weaknesses based on how the company responds to them. The earnings per share ratio is not good because when compared to the industry. they are not earning as much money for each shareholder.
04 for good reputation. These two factors are very important to Wal-Mart's structure and well being as a whole.04 for favorable access to distribution networks. . The weaknesses weighted scores were . We rated each strength and weakness based on how Wal-Mart seems to be positioning itself against its competitors. no formal mission statement.03 for a damaged reputation. Since these were only minor we gave them a score of 2. The strengths were weighted: .05 for satisfaction guaranteed programs. . By using these scores in the internal factor evaluation matrix. They are above the average company when it comes down to its strengths and weaknesses and how they deal with them. customer orientation.03 for undifferentiated products and services. They are determined by how important that quality is to Wal-Mart and how hard of an impact each has against other businesses. . undifferentiated products and services. . .03 for insufficient ratios. we also identified key weaknesses. In their weaknesses. non-unionization.15 for non-unionization. The financial position of Wal-Mart and the well-rounded business that it is has made WalMart what it is today. few women and minorities in top management. . .03 for well-rounded business. satisfaction guaranteed programs.07 for employees.04 for ease of website. We also rated some major weaknesses. slow speed of checkout service. undifferentiated products and services.05 for few women and minorities in top management. and finally a damaged reputation.04 for slowing speed of checkout service. . and the slowing speed of checkout service.07 for customer orientation. . . These included insufficient ratios and their damaged reputation. These weights show the importance of each strength and weakness of Wal-Mart. ease of website. good reputation and favorable access to distribution networks all have been very successful strengths for the company. These are so successful we rated each with a 4. .05 for no formal mission statement. few women and minorities in top management.05 for stock ownership and profit-sharing. If these factors are not evaluated regularly. . we came to a total score for Wal-Mart being a 3.access to distribution networks.01. . Along with key strengths of Wal-Mart. site research. we thought that minor weaknesses included: non-unionization. .05 for site research. no formal mission statement. The key weaknesses are some ratios are not sufficient. and . site research. The weaknesses have also been weighted. one-stop shopping.04 for financial position. and . which is above average. We felt that the most important factors were one-stop shopping and non-unionization.14 for one-stop shopping. Wal-Mart's employees. they could put a start to its potential downfall. stock ownership and profit sharing. which we rated as a 1. Because of this success we rated these factors with a 3. .
7. Tower Records. Richard Sears. . Clothing Retailers e. Sam Goody CD Universe. Mail-order businesses found success expanding to the web. Alvah Roebuck……used this model in the 1890’s. Some shoppers obtain information online and then order by phone. Barnes & Noble. luxury goods. CDNow. Lands’End. Aaron Montgomery Ward. Web catalog model is successful for a wide variety of consumer products.g. books. Sell a full range of products. videos. 3. Sun Microsystems use web catalog model.g. Luxury Goods e. The Good Guys!. 6. Kmart. Gateway. 3. Traditional retailers e. 4. Dell. Circuit City. 1. Books seller Amazon used this model K& this inspired other booksellers to jump in e.g. Allow consumers to specify the exact configuration they want (Dell). Web Catalog Advertising supported Advertising subscription mixed Fee-based Web Catalog Model Based on mail order catalog model ––it’s been used for over 100 years. 2. general discount merchandise. Music & Videos e. Books-A-Million. Radio shack also use this model. Web catalog model is used by Computers. Gap. Vera Wang.g. clothes. Versace.g. Target. Consumer electronics e. Apple. These approaches work for B2C or B2Bwork B2B. L. Costco. Have slowly incorporated e-Commerce. Talbots. electronics. Powell’s Books. Tiffany & Co. Wal-Mart. 5. Blackwell’s.L.Revenue Models Not all e-Commerce initiatives generate revenue. Bebe. Customers can buy through the web site or by phone. flowers. Evian. Computers companies e. Best Buy. Bean. Revenue models can be following: 1. Some companies seek to reduce costs or improve customer service.g. Wet Seal. 4. 2.g.
Wal-Mart also use web catalog model as given. .
AOL and Wal-Mart Connect. If you pay using Bill Me Later®. Note: Walmart. Sam's Club. A notification with the final status of your order will be sent via email. The Wal-Mart Discover is accepted everywhere you see the Discover Network sign. however. Credit cards: American Express. Thrifty Car Rental. MasterCard. You will receive a statement from and submit your payment to Bill Me Later. a security technology that authenticates your Visa card and ensures that only the authorized cardholder is placing the order. Walmart. ATM/Debit /check cards with a MasterCard or Visa logo on the front (including the Wal-Mart Money Card). Visa. When is my order charged? If you pay by Gift Card or Paypal®.com supports Verified by Visa (VbV). Bill Me Later ®. some non-U. based cards may not pass the designated information and security checks. we will be unable to provide additional details for any incomplete orders. Unfortunately. Wal-Mart Credit Card and Wal-Mart® Discover® The Wal-Mart Credit Card is accepted at Wal-Mart.com. Discover and Wal-Mart Discover. Walmart.S. to ensure the security and privacy of our customers. the money is deducted at the time you place your order. .Accepted Payment Methods We accept the following methods of payment: Wal-Mart Credit Card. your Bill Me Later account will be charged when your order ships. Bank To ensure the safety and security of your financial information and prevent unauthorized use of your credit or debit card. We are not able to accept the Wal-Mart Community and Business Card.com from completing your transaction. We do not accept checks or money orders. Wal-Mart Gift Cards and Online Gift Cards with a PIN. PayPal ®.S. • • • • • • If Your Card is Issued by a Non-U.com performs security checks in partnership with third parties. Failure to meet the appropriate security criteria will prevent Walmart.
while Bill Me Later has an interest rate of variable 19. • After all. they can put the purchase on a line of credit to be paid off later in monthly installments. as well as your name. Once logged in. there are alternate-payment services.com and PetSmart.89% variable. For comparison's sake. you'll be temporarily rerouted to the PayPal site to confirm your payment. PayPal. you will need to enter your PayPal login information and password.99%. is the oldest and most well-known of these services. . WHY Wal-Mart uses such an enhance payment system as it is in stiff competition with Amazon. For consumers with great credit. don't have credit or who are just plain scared of getting their information stolen. Your Payment Information Near the end of Checkout.. phone number. After placing their order. address and phone number as they appear on your card statements • For Bill Me Later. shoppers using newcomer eBillme receive a virtual bill that they can later pay using money from their bank account. according to Bankrate.If you pay by credit or ATM/debit/check card. Facilitating customers with enhance multiple payment system. Also offering customers more ease. is the most widely accepted at top e-commerce sites — including those of Wal-Mart. with PayPal's Pay Later service. date of birth and the last four digits of your Social Security number • For Gift Card payments. For those Internet shoppers who have either cut up their cards. standard credit cards carry an average rate of 13.75% APR. which is owned by eBay. according to Javelin Strategy and Research. High Interest Rates PayPal's buyer credit option charges a variable 22. you will need to enter your name. which launched in 2002. PayPal enables shoppers to pay immediately with a credit card. those rates could be much lower. We are committed to protecting your privacy. ensuring security to the payment system as well. Once the payment has been made in full. Amazon. Here is the information required for each type: For credit cards and ATM/debit/check cards. the retailer sends the customer their goods. Swiftly growing Bill Me Later. credit card number and expiration date. you will need to enter your Gift Card number and PIN • For PayPal.com. the payment amount is authorized and held by your financial institution at the time you place your order and your account is actually charged when your order ships.com will never sell or rent any of your personal information under any circumstances. you will be asked to choose a payment method. according to Brulant Inc. bank account or e-check or. address. more than 85% of e-commerce transactions are completed with a credit or debit card. Walmart. a market researcher. a market researcher. The service puts orders on a line of credit and sends customers a paper bill. you will need to enter your credit card type.
Expansion of dial-up Internet access to rural areas where the only current option is longdistance. Internet shopping growing.Why launch web portal: 1. 5. . 9. 8. 7. Consumers want ease of shopping. 6. 3. Offering value additions to customers. Retail sales expected to increase. Supply chain management offering. 4. Asian market virtually untapped by retail. 10. European Market untapped by retail. 2. Environment conscious consumers. Elderly population growing.
com plans to offer their customers over 900. and information on special sales and liquidations.com has the distinct advantage in this area.000. late shipments. 2. Merits of conducting business online: 1. The initial launch of the web site was deemed a failure for several reasons such as lack of product selection and difficulty of use. offering order status and tracking. Offering order status and tracking. Also. walmart. missed Christmas. trouble! Everyone decided to holiday shop online that year. The Broadvision .000 products. utilized below standard graphics along with a poor choice of colors. they can return the item to their local Wal-Mart.Website history: First web-site in 1996 contains information about the company. all of which made the website extremely difficult for consumers to navigate. tying its Web site into its real world stores. Wal-Mart spent $100 million. “the web site is yet to make a significant contribution to our sales. a help desk.000 items that could be found in any of 24 departments such as gardening and electronics. a store logistics. a clear return policy and mechanisms. If customers are unhappy with their online purchases." says Wal-Mart's Lin. New web site works! This website offers approx 1. the website lacked user friendliness (it was extremely difficult to navigate). The original website was therefore unsuccessful and unprofitable. Wal-Mart spent more than $150 million getting it right. (Wal-Mart. slow loading. This new website was supported by a dedicated central distribution center that only serves Wal-Mart.com. no online store. caused major headaches for many stores. After 8 months. on another website. Clear return policy and mechanisms. This time again results in failure due to Usability problems. 3. community services such as photo sharing are provided. This result in lost orders.” 1999. a store locator. Help desk. confusing. they took it down completely for 4 weeks! In 2002.com matured. 4. "We recognized that one of the greatest values is in integrating the online and offline channel. According to Wal-Mart spokesperson Melissa Brown.). According to e-commerce analysts. Merits or demerits of conducting business online The giant discounter's true strength online is in its bricks 'n clicks integration. The new Wal-Mart.
com and etoys. which may be a deterrent to potential visitors. Heavy running costs.) 2. etc. purchase airline tickets.com does not have the required bandwidth capabilities to handle heavy traffic. 5. 8. Being such a large international corporation. Information on special sales and liquidations. It still lacks the customer personalization features used by Amazon.S. the site also offers a photo center. 4. for example. the search engine will not find it.com and have them installed at a local Wal-Mart. The formation of the . You can. maps. This is despite the fact that if one clicks on the video game section there will be an advertisement for the game. a very popular video game. state. you can also view your prescription history online and set up e-mail reminders for refills. 6. Wal-Mart is located in almost every U. Integration of both online & offline business e. and its straightforward blue and white design gives it a dowdy look. . Demerits: Although Wal-Mart. in 2004.g.technology being used provides website personalization such as store locators.com ranks high in customer satisfaction. 7. The site's pharmacy section lets you place an order to be picked up locally.com version however. The site's vision center offers a similar service for contact lenses. The . Another major flaw is that Wal-Mart. its website has several flaws. According to Forester Research. 5. email them to others. chose replacement tires at Walmart. the website has slow response time. login profiles and a purchase history. Customers can drop off film at a nearby Wal-Mart. This is a major obstacle for the offline giant to compete with the online giants such as Amazon. This means that sales tax would have to be collected on all purchases. view their photos online. 3. if you utilize the search to find Need for Speed 5. limits sales tax collection to three states: California. Weak search engine (For example. 1. Utah and Arkansas.com company has a physical presence in these three states requiring sales tax collection. The site offers an online travel agency that allows customers to make travel reservations. have them printed at any Wal-Mart worldwide and finally. Tax advantages.
6. Wal-Mart website has often closedown as from this: .
Amazon Web Services provides Amazon’s developer customers with access to in-the-cloud infrastructure services based on Amazon's own back-end technology platform. Electronics. Movies.com. according to an annual survey of holiday shoppers released Tuesday.com. Computers & Office. Amazon SimpleDB. QVC 3. Amazon and Netflix 2.ca.com and Netflix shared the No.amazon.com.com. Inc. seeks to be Earth's most customer-centric company.amazon.com. a Fortune 500 company based in Seattle. Barnes & Noble. Health & Beauty. Grocery. “Amazon.fr. Kids & Baby.de. Toys. Sports & Outdoors. Examples of the services offered by Amazon Web Services are Amazon Elastic Compute Cloud (Amazon EC2). Inc. Amazon and its affiliates operate websites.com. Apparel. unless the context indicates otherwise. www. and its subsidiaries. and endeavors to offer its customers the lowest possible prices. Newegg.Competitors Analysis: Amazon.amazon. which developers can use to enable virtually any type of business. where customers can find and discover anything they might want to buy online.co.walmart.uk. Amazon Elastic Block Store. Amazon Mechanical Turk and Amazon CloudFront. Amazon growth factors: Several factors drive this growth.com. Amazon.jp. Amazon.com. Music & Games. and www. Auto & Industrial.co.amazon. Amazon Simple Storage Service (Amazon S3). AMZN. Amazon Flexible Payments Service (Amazon FPS). www. Shoes & Jewelry. refurbished and used items in categories such as Books..com.amazon. (30 December 2008. FGI Research) 1. Home & Garden. As used herein.com and other sellers offer millions of unique new.amazon. Inc. opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. .com About Amazon. and Tools.com Amazon. Digital Downloads.” “we. www. BN. Amazon Simple Queue Service (Amazon SQS). LL Bean.” “our” and similar terms include Amazon. 1 ranking in customer satisfaction among the largest online retailers. including www.amazon. www. www. They include Amazon expanding into new categories beyond books and music—more than a dozen in the past year. Apple.cn.
“This is Jeff’s way of codifying what keeps a company alive and spirited and keeps people innovative. Included in 2008 operating income is a $53 million non-cash gain recognized on the sale of the Company’s European DVD rental assets. compared with $14.12 per diluted share. Those picks and shovels include a variety of services Amazon offers partner retailers. or 28% excluding the $127 million favorable impact from year-over-year changes in foreign exchange rates throughout the year. . setting the hiring bar high and frugality.17 billion.” he says.49 per diluted share. are divorced from the long-term maintenance. which means it does not have to pay license fees for operating system software. and employees are reviewed every six months on how their performance stacks up against them. or 27% excluding the $10 million favorable impact from year-over-year changes in foreign exchange rates throughout the year. they will become separated from the actual costs of customer complaints and bugs. ownership. Bezos believes strongly in employees taking ownership of their work. But the biggest lure is the opportunity to reach Amazon’s massive customer base. the web pages. says a former employee who asked not to be named. even as the company grew dramatically.The e-retailer’s free shipping offers and low prices encourage frequent purchases by 81 million active Amazon shoppers.” As for frugality. “And that will lead to lower-quality software. the former employee says.” The other five building blocks of Amazon founder Jeff Bezos’s business philosophy are innovation. as if they had the high dreams you associate with start-ups. the first of the company’s six “core values” is: “Customer obsession: We start with the customer and work backwards. or $1. Net income increased 36% to $645 million in 2008. in 2007. or $1. a bias for action. compared with net income of $476 million. Financial Information’s: Net sales increased 29% to $19.” he says. Operating income increased 28% to $842 million. Amazon uses Linux as the operating system for its thousands of servers. At Amazon. “He was concerned that if the people who create the user experience. These guideposts are taken seriously within Amazon. such as handling payment and fulfillment.84 billion in 2007. which made him reluctant. compared with $655 million in 2007. to hire temporary contractors and to create separate teams to maintain software developed by others. The Amazon Way Many retailers claim to be customer-focused. And thousands of other retailers are helping expand Amazon’s selection by selling on Amazon— even though it means paying a commission and handing over customer data to a competing eretailer.
8. 3. Use strong color to attract more customers. 5. Use website to clear its position against critics like wakeup Wal-Mart & Wal-Mart sucks. 7. 4. Enhance usability by offering live chat options offering customers saving as well as value additions. 2. Find affiliates in areas outside of major cities where store closings have limited consumer choice in your category. add video and upgrade training of service agents to appeal to new online shoppers. . Wal-Mart should clear its mission statement. 6. Promote use of live chat to reduce call center costs. Enhance product images. Highlight sale items and special offers in site search results.Recommendation: 1.
Amazon’s revenue is a paltry $19. Wal-Mart can afford to take its time in growing its online market share. after all. With a jawdropping revenue figure like that. it may not matter that Walmart. an effective part of an overall retail operation that generate 401.17 billion). It is.com lags its online rivals. leveraging its massive offline presence to compliment its e-commerce operation.In a nutshell. . with the power of this integration.2 billion in revenue in 2008 (to put that in perspective.
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