E-commerce Strategies of Amazon and Walmart

This case study discusses the e-commerce strategies of Amazon and Walmart, along with their assets and revenue models. It also covers the channel conflict between online and retail stores of Walmart and the operational fulfillment of both companies.

Running head - E-COMMERCE
E-Commerce
Name of the student
Name of the university
Author’s note

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Introduction
E-commerce have been one of the prominent growth in the business sector. It have
been growing its wings exponentially from the rise in sales to the rise in the revenue too. The
process of e-commerce in a nutshell could be described as the process of buying products and
selling them by all means of electronic equipment and supports like internet and other mobile
applications that are made for supporting e-commerce process. The process of e-commerce
have been increasing the sales of the products as the rise of technological development have
been making a huge impact on the rise of ecommerce as well. In the business of e-commerce,
many supermarket are also entering for competing with the new era of retail. Out of these
supermarket hubs, Walmart is one of the prominent name, which have been enacting the
concept of e-commerce in their organization as well (Laudon & Traver, 2016). However,
compared with another e-commerce hub, Amazon, it have been making a huge change in the
prospect of their retail as well through e-commerce.
The following case study would be discussing, comparing and contrasting the needs
of e-commerce in retail tycoons like Amazon and Walmart. In the case study, there would
also be discussing of various aspects like the strategies used by these organization for
supporting and upgrading the process of e-commerce, in-sourcing of materials, leverage and
assets of the retail tycoons as well.
Discussion
In respect to the digitalization of the market and coordinating with the modern market,
the modern consumers are also increasing the values are being able to shop online rather than
on brick and motor retails (Kim & Peterson, 2017). The major asset that Wal-Mart have
acquired recently which would initially help them in competing with Amazon and other
retailer is the acquisition of Jet.com. Other than that, Wal-Mart are now currently testing

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some of the self-driven cars in the state of Arizona. These cars are specially designed for the
picking up the customers for grocery shopping. These cars are automated for picking up
customers from their pickup points and dropping them to their destination for completing the
detour. The organization is also undertaking experiments in their research and development
facility for the implication of robots for pricking groceries and processing the pickup orders
in their stores at New Hampshire (Rutherford et al., 2016). And lastly the expansion of the
stores retail by signing contract with more than 1,100 brands have become a prominent action
plan or asset of Wal-Mart for competing with Amazon or other retail stores. This have helped
Wal-Mart in getting a grip on the market analysis and also help them in taking some action
steps in order to make significant approaches for competing with Amazon (Goolsbee &
Klenow, 2018).
Amazon is the biggest e-commerce retail organization, which is currently being
operated around the globe by millions of customers. As being the leading e-commerce
organization, Amazon also have some competition in being in the market of retail business
(Akter & Wamba, 2016). Walmart is one of the biggest competition in the market currently
that is operating against Amazon prominently. Amazon is considering in opening their own
retail stores, for competing directly with Walmart on the field. With the name of Amazon Go,
the organization have been planning for opening these retail stores for providing competition
to the Walmart retail stores. Another asset that have been inherit by Amazon is the
application of marketing strategies of the organization for boosting their sales. In this aspect,
Amazon would be having a greater approach over the e-commerce market in aspect of the
selling their products to the potential customers as well (Rahayu & Day, 2015).
Walmart have been keeping a keen understanding of the market of e-commerce and
trying to make enter market as well. The warehouse chain of Walmart, also known as the
Sam’s club is the warehouse unit of the organization (Sambhanthan & Good, 2016). It have

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been witnessed that the organization’s warehouse unit is likely to have a major boost in
aspects of sales of their food production and all the everyday essential commodities through
the development of a joint-partnership with the organization Instacart. With the help of this
strategy, the customers of Sam’s club would be eligible for getting their orders delivered at
their doorstep in a particular timeframe as well. Along with the same day delivery service of
Instacart, the shopping of Sam’s club would eventually be expected to be enticing for the
customers only (Laudon & Traver, 2016). Walmart is also providing a much simple shopping
experience for their potential customers by implementing more shopping methods and
seamless deliveries for the ordered products as well. In fact, apart from just strengthening the
sales of grocery only, Walmart are also increasing the sales of their furniture and products of
home décor as well. The company is likely to launch some new online platform which would
eventually expand the e-commerce space of for the organization through buyouts and the
implementation of strategic alliances. The organization have been enhancing their e-
commerce strategies by making deal with the Japanese prominent e-commerce firm Rakuten.
In accordance of this deal, the organization would be eligible for selling online products of
grocery in Japan along with e-books and audio books in the United States of America
(Johansson & Kask, 2017). The organization have also being making some prominent
changes in their apex level management for enhancing and implementing the skills
application of e-commerce in Walmart. The constant expansion efforts have made a lot of
investors for invest their stocks on Walmart for boosting their business approach of e-
commerce.
Amazon have been biggest e-commerce business around the globe. They have been
creating a major change in the business of e-commerce with their extensive development of
strategies for enhancing their operational activities. One of the major strategy that Amazon
have developed is the implementation of the Amazon effect (Goulet, 2019). This effect refers

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to the shifting of expectation of the e-commerce customers because of the services that the
Amazon have provided to their potential customers. The service provided by amazon are
considered to be frictionless, which initially makes the expectation of the people more over
the organization. Therefore, the effect of Amazon have been used as a crucial strategy for
enhancing their e-commerce business (More, 2016). With their one click shopping facility,
the feature have always helped them in being the number one enterprise in e-commerce
industry until 2017 as the expiring of the patent. This feature have helped the organization in
having additional hoops in the organization’s operating system. Along with the automated
marketing strategy, Amazon have been encompassing the suggestion of their customers
previewed products and according to their latest buying factor as well. As customers preview
along the preferred products of their choices, Amazon generates a series of suggestion for
their customers in pop up versions, which helps them in sorting the correct product in less
time. These strategies have helped Amazon in developing a prominent market (Yuan et al.,
2016).
Amazon have a huge marketplace where each day billions of people daily access and
purchases their products. The platform set by Amazon for retailing also incomes money for
visits also. It is estimated that only in the United States of America, there have been more
than 2.7 billion visits. Therefore, on an average, each individual spend more than 6 minutes
in the site just surfing only (Head, 2017). This popularity helps them achieve optimum views
for the site which in fact also makes them earn revenue. The organization earns from the
supplier as well. The organization offers programs for the potential sellers which helps them
grow their business by selling their products and brands on the website, which helps them in
fulfilling the customers’ order as well as their needs. The organization charges interest on
them as well. On the other hand, Walmart generates revenue on the basis of physical and
digital access. This helps Walmart in making money with both of their physical presence of

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retail stores in existence and also digital access to broad merchandize of customers through e-
commerce and mobile commerce as well. The organization also generates revenue from
Sam’s club, which is a warehouse club of the organization being operated under the website
of samclub.com (Sisodia, 2016).
Walmart have always wanted to buy the commodities online in much cheaper way.
However, this aspect does not goes well with some of the high end brands which have a
marketing managers have been concerned about the premium image of the brand. Therefore,
this creates a channel conflict among the suppliers and the seller of the product, where one of
the channel member interferes with another channel member while fulfilling the desired goal.
Therefore, Walmart does not intervene with the conflict as it have been developing a proper
channel of better in the retail stores than that of e-commerce as the same product the
customers could afford from the retail store as well (Rangel, 2018). Hence Walmart is not
worried about the channel conflict between the online sales and the store sales.
Walmart have been taking the approach of in-sourcing rather than outsourcing from
low-cost countries and other domestic firms as well. This method have been adopted by
Walmart for three primary factor; risk from hackers, accessing the primordial customer base
and controlling the quality of the products. There have been many cases like with other
supermarket retail tycoon like Woolworths, where the entire system of the organization was
crashed, which initially made the organization loss millions of dollar and for just one hour
only (Rangel, 2018). Therefore, taking control of the product would help the organization
save them from outsource hackers. Walmart have taken the control of their product for
accessing the ground control of the base of the customer. Without the involvement of any
third party in the flow of management and products, there would be no chance of outflow of
the products as well as it would help Walmart in knowing the exact need of the customers as
well. The third factor is the quality control, which is one of the most vital factor. Quality is

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the factor which helps in acquiring the loyalty of brand as well as the customers. With the
product in-souring in control of Walmart itself, it would help them in regulating the optimum
control over the quality of the product.
While Walmart having a strategic e-commerce business model with would help them
in achieving the likely long term goal, the acquisition of Jet.com had been a smart move
made by the apex level management of Walmart. Therefore, the acquisition of Jet.com have
made a prominent requirement for the organization as it have helped them in achieving more
customers. The top priority of Walmart currently is to leverage Jet.com for reaching new
customers. Amazon have made some strategic acquisition which have helped them in
creating a proper relationship in between the internet retail arena (Goulet, 2019). This factor
have helped them in making a prominent market for sustaining the sales of their retail
products. The organization have also developed a schematic sketch of the market where there
have been proper analysis of the market with applying the basic concept of e-commerce.
The operational fulfillment of Walmart different from Amazon in many separate
ways. Mostly in e-commerce, the involvement of third party is not acceptable or not used
properly. With the application of strategic marketing traits. Walmart have a proper
segmentation of operational fulfilment, which Amazon lags.
Conclusion
Hence, the case study could be concluded by providing brief overview of the e-
commerce commodities that are maintained and used by retail marketing tycoons like
Amazon and Walmart. The case study have discussed about the key assets of Walmart that
could be leveraged for competing with Amazon. The case study have also discussed about the
assets that Amazon have and could be used as leverage to compete with Walmart. The case
study have also provided a thorough narration about the e-commerce strategies of both

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Amazon and Walmart, along with the revenue model of both the companies as well. The
assignment have also discussed about the channel conflict between the online and retail stores
of Walmart.

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References
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