Not too many years ago, Walmart’s e-commerce operations were largely overshadowed by Amazon. No more, according to a web optimization consultant who specializes in retail and financial services clients.
“For sure, Walmart has a huge leg up on last-mile logistics. They have 4,700 stores in the United States,” said Gregory Ng, CEO of Raleigh, N.C.-based Brooks Bell, a web optimization consultancy that’s worked with companies such as Gap, Chick-fil-A, and Barnes & Noble.
“Walmart had been clunky dealing with people savvy in buying online, but that’s changed,” Ng said. “Walmart has invested in a culture of testing and learning on the digital side. It has made major leaps transferring its vast knowledge of store-purchase data to its e-commerce operations.”
He is sure that Amazon will be aggressive in pursuing real estate opportunities in hundreds of locales for fulfillment centers in the United States, including emptied department stores in enclosed malls. Simon Properties’ talks with the e-commerce goliath about emptied Macy’s and J.C. Penney spaces in its portfolio could well come to fruition, said the consultant.
“But where do malls draw the line?” asks Ng. “Will they allow Amazon to also do retail? Do they do lockers and returns in dealing with retail customers? In making that partnership work, both mall owners and Amazon have to focus on providing a customer-centric experience.”
The biggest challenge each of these dominant retailers faces is selling groceries online. On both the Amazon and Walmart sites, shoppers can buy hard merchandise and groceries on the same visit, but must execute separate checkouts. When it comes to delivering the goods, however, Ng says the world’s biggest online seller has a long way to go to catch up with the world’s most expansive physical retailer.
“Amazon did a lot of the hard work on successfully shipping food, but Walmart can mop it up. Walmart has all those stores and a lot of employees who can easily be trained to enter orders and drive trucks,” he said.
“Walmart has another advantage,” Ng maintained. “The majority of Americans trust Walmart.”