Walmart's done a good job of trying to carry as many things on its site as Amazon. I find most things listed on both sites. I also like the idea of free ship to store and use that.
The problem is the same that Target, and Barnes and Noble all have in competing with Amazon. Their sites aren't as good. They are spartan, uninteresting, hard to navigate, difficult to find things, and often so slow as to be unusable.
In short their developers, development managers, server staff, etc, aren't good enough.
On Amazon I can find what I need, the site looks good in all browsers including old ones, it doesn't bog down the CPU, stall or crash the browser, and products can be found using their own search mechanism without having to resort to using Google.
Barnes and Noble probably needs to realize it’s core value is the in store experience of leisurely browsing at a kind of “third place” away from home/work. Honestly I don’t know anyone who has bought a book on B&N online, but know lots of people who just want to hang out at a Barnes and Noble and read/explore. That was the appeal in the 90s, that’s still the appeal. Nook and e-commerce are just distractions from that main differentiator.
I wonder how many other places are just being bad amazon clones when their core value is something different...
Yes, I’ve definitely been stopping in at B&N to browse more recently. Honestly even though I read library books electronically, I still browse and buy physical books too. And of course magazines...and notebooks...there’s a market there.
>Barnes and Noble probably needs to realize it’s core value is the in store experience of leisurely browsing at a kind of “third place” away from home/work.
Being a place to wander around and browse but never purchase the merchandise is not a "core value" any retailer wants to have. Barnes and Noble is not a home away from home, it's a store, no different than any other. You're meant to buy something and get out.
If you’re going to compete with Amazon on a “buy something and get out” basis, you’re going to have to offer me something better than Amazon. If that’s “you’re expected to drive over here and park”, you aren’t winning. If it’s “you can drop in, have a look around, maybe get a coffee in the cafe, chat with a semi-knowledgeable associate, crack a book open and sample a few pages before buying”, then you’ve got a fighting chance.
>If it’s “you can drop in, have a look around, maybe get a coffee in the cafe, chat with a semi-knowledgeable associate, crack a book open and sample a few pages before buying”, then you’ve got a fighting chance.
The key part of that being "before buying." Many people will literally just browse and use the free wi-fi and some will read entire books and magazines in the store without buying anything.
A certain type of store should want that. I doubt a store that spend huge amounts of money in stocking their shelves with books will get as much out of it as a coffee shop.
That said, my local B&N has a Starbucks inside (and a Peets 40 feet away directly across a small street), but I doubt they get more than a small fraction of the revenue from the Starbucks, and at around 4-5 times the floor space as the Peets.
Because even if someone doesn't intend to buy anything, and was only planning on going there for free WiFi, there is still a high chance that they will purchase something anyway.
every B&N I've ever been in was chock full of people (often students, judging by their textbooks) who are taking up seats and tables but don't appear to be buying enough (or anything at all). my guess is that providing unmetered, unregulated seating space in a book selling retailer is too often a losing proposition. is that wrong? what am i missing?
> know lots of people who just want to hang out at a Barnes and Noble and read/explore.
Maintaining a large inventory of books is a financial burden for bookshops. For that reason, most massive bookshops in North America and Western Europe have slashed their book inventory heavily compared to the 1990s. In the place of books, they prefer to sell trendy things like vinyl records, Kikkerland products, teas, etc.. However, while a customer can spend a few minutes looking at what’s available, this kind of inventory does not offer many opportunities for “exploring”.
Also, even if customers would not order from B&N online, they might still order a book they see at B&N from Amazon, perhaps even while they are inside the B&N. Smartphones allowing customers to browse in your store and then order a desired item for cheaper from your competitor, were not yet a thing back in the 1990s when B&N was in its heyday.
This may all be true, but I feel like the solution is somewhere in building on the brands strength (as a 3rd place) instead of trying to be bad Amazon.
It's far more likely that their tech staff are simply not given sufficient resources, and are constrained by business leadership than that they "aren't good enough".
Walmart is notorious for having terrible compensation for their tech staff--staff who are motivated to look elsewhere due to poor compensation aren't going to do good work no matter how good they are.
If you play out the terrible comp, you are almost sure to get the “not good enough”.
People work for a variety of things, but comp and colleagues are high on my list. If you give me crap for both and I have options to go elsewhere, you’ll be left with people who don’t have options to go elsewhere. They’re probably not going to end up being the cream of the crop.
Eh, surprisingly enough if you give people power they accept lower compensation. Even a well paid person leaves their job if there is an ineffective structure at implementing change at a reasonable basis.
And if you make change to easy, you get weird Frankenstein technology stacks urdened with technical debt, so you need competent managers to hit a good middle ground. And you need competent executives that can set good goals and provide enough resources to achieve them.
Basically, you need competent people at every level. That said, since the competence of a level is directly controlled by the level above it, I guess it does just boil down to bad execs now or at some point in the past (or a good strategy not just working. The world isn't that deterministic).
That's exactly why companies still don't understand that you get very crappy code by using cheap outsourcing companies. If they were better developers, they would just work at a company with better compensation. In this situation you only getting people who don't have any choice.
If they were better developers, they would just work at a company with better compensation.
This is not necessarily true. FAANG have great compensation and excellent reputations regarding the technical capabilities of their employees but people leave them or choose lower compensation offers at smaller companies over their offers all the time.
I would want to know which of those developers have lower compensation because they joined a startup or something similar with the _possibility_ of a much bigger payout in the future. Or moved to a much lower CoL and accepted a smaller comp.
My point is: your observation that FAANG developers do accept lower comp for work elsewhere is not very convincing.
I have just passed a FAANG interview, but I'm leaning towards another offer at about 70% of the offer likely from the FAANG interview for a number of reasons (commute and impact I can make are the top two). The offer I'm considering is at a company where two ex-FAANG were in my interview panel.
Mm I would bet (from experience) that's it senior leaders in non tech (and some tech) companies still view the internet as something that is exactly like the old way of doing things.
A lot of places see the website as just like a print media poster site to outsourced to the lowest cost provider and don't realise that it is now a core competence.
And I'm not even sure if that's the problem. My assumption is "move fast and break things" is not in their vocabulary.
I'm going to assume even the smallest change to improve things requires a few months of meetings before its implemented. This quickly depresses anyone even halfway good at their job and they leave.
There are substitutes for AWS, but the switching cost is relatively high. Whereas for toothpaste, breakfast cereal, toasters, books etc etc the substitution is perfect (I can buy the same brands from many companies) and switching cost is low (I pull out a credit card).
Insofar as Amazon has a large free cashflow coming off AWS after capital improvements, it can use that money to (a) attract cheap funding from Wall St to (b) build, build, build.
Having used most of the competition, none can consistently compete. While they may have some better numbers, configuration complexity and user experience make achieving them in real-world use difficult
Lol, amazon retail still hardly uses AWS. They use mostly their custom nosql database sable and a ton of Oracle SQL databases (albeit, a decent amount of those are getting migrated to rds postgresql)
That’s really odd, just checked on my iPad which has never been to Walmart.com and it fully loaded in under 2 seconds. Amazon.com which I have visited before was mostly done in the same time frame, but took around 4 seconds to fully load.
Just tried with ublock disabled, it's about 3.1mb and loaded in 3 seconds flat here. I'm not sure what GP is going on about. Amazon was 14.4mb and took about 4.5s to settle down.
I will say, Amazon's above the fold paint was faster, but it did load a LOT after that.
It doesn't work very well. It doesn't stick, and the results are clogged with out-of-stock items. ‘I do not think that word means what you think it means.’
I think there are color schemes on the site which are reminiscent of their relatively uninspiring stores, which creates a bias against their site by those who have spent time shopping in them. The site has also been through a number of iterations and some people might be working off outdated memories.
For a counterpoint, it loads essentially instantly (less that 1s) on my machine, and includes an easy-to-find and semi-well-functioning in-store only filter, which autosuggests my local stores and remembers my choice. It does need to filter out "out-of-stock" items, which they've made a specific choice not to do, and has nothing to do with permormance/design/ui.
The main problem is most of the images are extra large and poorly optimized (they are all preloaded it seems, as Next.js does automatically). Even on my fast fiber connection it flashes.
Walmart.com is also using React, and Walmart labs developed significant tooling for server-side render and partial render caching for specific components. They've published a lot of articles on their technology choices and how well they do.
Amazon's above the fold render does appear a little faster, but their total payload and load time is much larger/slower.
I get your snark at my use of monopoly for two companies but think about it. One has a monopoly on physical retail in most of America. The other has a monopoly over most e-commerce. Which ever wins will have a true monopoly over commerce in general. Scary. And not “free market” capitalism.
Walmart has a monopoly on physical retail? I can almost understand your position on Amazon e-commerce, but I don’t think Walmart is anywhere close to monopolizing physical retail.
Have you been to a small town in rural America?! Walmart In many communities is the town square and effectively the only retailer other than maybe a dollar store.
I suspect that when most people refer to small towns they are implicitly including most suburban areas which are a big chunk of that 82%. (i.e. there are a lot of cities that don't have a significant downtown population but have massive suburban sprawl)
That doesn't make them a monopoly; it makes them a preferred option by consumers. In the US, antitrust laws are concerned with vertical domination of a market. The consumers of these small towns made a _choice_.
It is a crime if the intent is to gain so much market share that pricing power is achieved at which point predatory pricing is pursued. This is an old business model; operate at a loss until your competition is driven out of business and then sit back and collect windfall profits. This was one of the main drivers of anti trust policy to begin with.
Not if it is part of a pattern of anti competitive practices. If you lower prices with the intent of putting competitors out of business that is not competition.
From what I've been hearing[1], you might want to consider the "maybe" in "maybe a dollar store". At 15,000 stores, there's probably a Dollar General in every community with a Walmart as well as every community in the surrounding 200 miles.
I think the mere fact that I split my time between the Bay Area and rural Oregon, yet never feel compelled to shop an Walmart comes close to disproving the physical retail monopoly argument. The nearest town to my house in Orgeon has a Dollar General, but it also has two local convenience stores that sell some staple groceries. Prices are high enough that I usually drive down to the nearest city, where I have nearly all the same retail options I have in the Bay Area (and more, if I need anything resembling farm supplies).
West coast experience does not match the rest of the country. Outside the largest cities and wealthy suburbs, you’d be hard pressed. Especially on an average salary.
Really? Where are most consumers living then? I think I'm in the unusual situation of seeing both sides of the urban/rural divide in a way that most people don't. The fact that I split my time between a major metropolitan area and a town that's only just starting to recover from the local sawmill closing a couple decades ago probably puts me a lot closer to the mean than most people.
Your metropolitan area is not representative of other metropolitan areas. Most of population is clustered around cities that are not comparable to SF and it’s surroundings, economically and culture wise.
Oregon is also notoriously unlike other states. In Utah, for example, if there is a big store in a small town, it's most likely a Walmart. In the town where I grew up, there were other options further away, but Walmart there now often has better and more diverse produce than several of the supposedly nicer chain supermarkets in SF.
Dollar General has over 15,000 stores and most are in towns of less than 20,000 people. [1] I think perhaps you're assuming too much and working off incomplete or obsolete information.
Dollars stores sell a subset of products not the full A-Z Thst amazon and Walmart specifically target. Small towns used to have a fabric store, a butcher, a florist, toy stores, auto parts. The list goes on. Walmart sells it all, often with no real competition, the dollar store does not sell all of those items.
It's true that it does not sell all the items Walmart does, but it does point towards Walmart having not quite as much of a physical space monopoly as you presented.
It also points towards the ability of other companies to compete with Walmart in niche areas (at least niche compared to Walmart). I could see a future where a few chains each carve out a chunk of the more popular Walmart inventory and out-compete Walmart on physical location, as Dollar General has done.
You can kind of imagine them as CPU cache layers. In-town local stores are L1 cache with great speed but relatively poor choice for all but the most common items, Walmart is L2 cache with good speed (not still slower for most, as it's a ways away for the majority of people) and better selection, and the internet is general memory with everything you might need, but slow speed. There has been a major upheaval in the L! level because of both a major shift in how close/fast and large L2 got (a shift from major cities to large complexes in rural areas) and a huge boost in general access (the internet), but I don't think it's all played out yet, since I think there's still need at the local level that's not fulfilled well anymore.
Sorry for the tortured analogy, but it did probably save time on both ends.
What a crazy world where retailers have such power. At this point, retail should be a boring and solved problem. The true power should be with producers and consumers.
Why is that important exactly? I would think that the gross margins don't matter much at all. If your net margin is -1%, who cares if your gross is 22%?
Because if your gross margin is high enough, it's possible to invest to scale such that with greater fixed cost absorption that your net margins can improve from -1% to +2%. Many companies go through a phase of initial losses (negative net margins) when they first start up until they reach scale where the gross margins pull the net margins positive.
A competitor to Walmart would be in grave trouble (and shouldn't even try) if their gross margin was 1-3%.
And the article says that Walmart is looking at the difficulty of bringing on a lot more brands. Walmart is famous for being rough on suppliers. Though Amazon hasn't really raised the bar, it sounds like.
It would be good if someone managed to pull off "we're the trustworthy go-to, for supply chain integrity and real reviews, and we treat all suppliers/brands/workers/customers with a reasonable degree of respect". Walmart would have a long way to go for that, but could they possibly manage the corporate will to do it, out of desperation?
Wait, so Walmart is about to give up on a 3-year-old strategic bet because they're losing to a competitor that had a 20 year head start[1]? This seems like classic short-term thinking in an ossified organization.
That said, credit to them for identifying an area of strength (grocery delivery) and leaning into it hard.
[1]: Amazon was founded in 1994, Jet.com founded in 2014.
EDIT: Also wow, this article needs an editor. Is the CEO's last name McMillon (5) or McMillion (2)?
To me, it doesn't sound like a question of giving up. There is a dispute over how much money to spend on infrastructure while pursuing growth. Do they spend lots and lose money for a while, or go with a slower build that's profitable? Apparently the high-spend advocates talked to the press as a way of pressing their case?
There's no way for us to know who is right based on reading one article.
Given Vox's hyperbolic nature in terms of articles and agendas, I'm not sure how big an issue it actually is. Beyond this, I'm frankly surprised it's only 1b this early on... Compared to most startup initiatives, accounting for scale, it's really not bad at all.
> This seems like classic short-term thinking in an ossified organization.
Yeah, unfortunately this is very common. There are good reasons for this. If you're a public company, your financial health is being constantly scrutinized by wall street which will punish your stock price (and thus, executive compensation as well). Which incentivizes short term planning, and long term investments need to pay some sort of dividend, or else it will become a closely scrutinized and wildly unpopular.
There's no mention of Walmart's recent acquisition in India[1] where they poured $16 billion to buy 77% stake in Flipkart. What's interesting is that there's no profit in sight for Flipkart (or Amazon.in for that matter). Which means they'll continue to bleed money. Especially as the Indian economy is showing signs of a major slowdown.
I too have similar thoughts . worse is soon after Walmart's acquisition of Flipkart, the govt came up with new ecommerce rules & regulations that made things really tougher for Amazon and Flipkart (there are widespread rumors that these rules were brought in to help Reliance Retail's ecommerce wing) .
and not a single mention of this situation. 16Billions isn't small, even at Walmart's scale.
I stopped buying online at Walmart Brazil because its third-party sellers were awful and Walmart just ignored my last complaint (I bought a keypad and got one that was different from the one advertised). I guess I wasn't the only one who was unhappy with their service.
Their stores are also pretty shabby. They entered Brazil buying Bompreco (which was not well run at all) and then they bought the Portuguese Sonae (which was reasonably efficient) and proceeded to weed out the good parts in order to homogenise the whole operation at the lowest possible quality.
Sonae had a really good POS on which you could even sell advertising space. It was replaced by a POS that looks like a 40 column DOS application.
Walmart and Magazine Luiza were the only 2 large stores that I accepted buying online from (Walmart doesn't sell online anymore in Brazil). I just never brought anything from 3rd party sellers, on any site (except the ones that only sell 3rd party things, that have good reputation management systems).
I have to say, I know of no large store with any passable POS on Brazil. They are all horrible.
im from europe and never seen wallmart in my life, but i wonder why are people commenting on POS system ? how is this related to your experience as a customer ? Do you mean POS system when doing self-checkout or something else? i'd be curious to know what you mean by that or by "no large store with any passable POS in brazil" ? thank you.
With regard to the Sonae buyout, the old POS had more options. You could even pay your bills or buy cellphone credits. The new one didn't even accept payments from the state bank (AliExpress, from the other side of the world is integrated into the state bank of Rio Grande do Sul).
It seems that WM just goes into markets with not enough planning.
I'm genuinely curious why an established business with supply chains, etc would lose 1 billion dollars a year in an ecommerce effort. Why? Selling below cost?
The brand means nothing to me, where walmart.com does at least have some brand presence.
I suspect it was simply the founders ego that kept jet.com as a separate site (rather than focusing on walmart.com). That alone is a bad sign, how many years have been wasted promoting Jet?
It was a thing. I actually used it frequently to get household items and save money on bulk orders. Then it got acquired by Walmart and I stopped shopping there. Same with Bonobos.
Jet spent heavily on acquiring urban millennial spenders. If that doesn't fit your profile, your comment makes sense. They also had a cart algorithm that changed your shipping price as you added things to it that was pretty cutting edge at the time.
“It’s taking longer than I thought it was going to,” McMillion told analysts in October of the e-commerce unit’s profitability, “and I have been surprised at just how many brands there are out there to get signed up. ... Who knew we needed 2,000 of them. I didn’t.”
The problem with Walmart and ecommerce are one of self-cannibalism.
Walmart.com is not Jet.com. They actually compete against each other! Why any corporation would run two separate ecommerce operations that compete is beyond me.
- When Walmart bought Jet.com, they already had Walmart Marketplace, which is very much like Amazon in that it's products stocked, sold and shipped by Walmart themselves - but also many 3rd parties which stock, sell and ship on Walmart.com too.
- Just like on Amazon - most customers are not aware they're not buying directly from Walmart. Unlike Amazon, there's no built in messaging system (you end up directly emailing customers, and until recently they didn't even proxy the email addresses - meaning you obtained customer's real email addresses). Returns are sloppy and painful for the seller to handle, and the Seller Central UI hasn't changed in years. It's a "modern SPA" website, but each button click must be doing some poorly designed queries or something terrible, because each view takes multiple seconds to display (showing a busy spinner gif while waiting). This makes doing trivial things very painful in the UI.
- Walmart.com's API isn't stable either. It's on version 3 now, and still seems to lack important features like advanced reporting - features Amazon has had for the decade we've been selling there. When version 3 of the API rolled out, they gave everyone a months notice that all previous versions would be "deprecated" - although someone at Walmart things deprecated means turning it off completely. This left anyone foolish enough to integrate with this clunky API 1 month to rewrite everything since it was a major change.
- You still have to be invited to sell on Walmart.com. Unlike Amazon - not anyone can just apply for an account and start selling. This is a two-edged sword, of course. While it cuts down on random people selling out of their garage - it does limit the diversity of products and sellers on Walmart's Marketplace - and ultimately revenue Walmart.com can bring in.
- Walmart offers no "Fulfillment" options for their 3rd party sellers. While this is currently not necessary, since you must be a legit ecommerce business of a considerable size to even be invited to Walmart.com, it would be a great option for many to help cut down on delivery times and shipping fees by stocking some products on the other coast, or throughout the country. Many large operations on Amazon take advantage of the FBA program specifically for these reasons.
Now speaking about Jet.com - I'm not sure why Walmart didn't fold them into the Walmart.com branding. It's a disaster. It's been 2 years since we seriously looked at Jet.com, perhaps some things have changed - although I have my doubts due to how Jet.com wanted to operate.
We also have a Jet.com account - but chose not to participate because the barrier to entry was too high for such low projected sales.
- Jet.com requires API use to do anything. There is no Seller Central UI to manage products or orders.
This requires an API to even list a product. No CSV or Flat File uploads, which both Amazon and Walmart allow. No manually editing product details for a listing, or manually reviewing your orders via an Order Manager page.
While that may be good in that it makes the barrier to entry high enough to keep out casual garage sellers - it also kept out larger profitable operations like us. We took one look at it, reviewed their API, and decided it wasn't worth the development effort to get a handful of sales each week. At the time, there were no good integrations that we could just pay for either - not to mention they wouldn't integrate with our ERP software either - so we'd still have to spend the development time anyway.
Essentially, Walmart Corp is trying to run two, competing ecommerce websites - both with serious flaws that prevent either one from being easy or enjoyable for their sellers. Being custo...
Walmart bought Jet back before Jet had any real market share. Most figured they bought Jet to aquire their technology and people, namely Jet's founder.
And there's nothing shared between Jet.com and Walmart.com - unlike Ford being able to build Jaguar's in the same factory, or benefit from shared economies of scale. Walmart doesn't even sell on Jet.com, it's purely 3rd parties.
Stories like this are often instigated by someone inside the organization with an agenda. They reach out to a journalist, give some quotes anonymously, and put them in touch with others in the company that are allies and will also give supporting quotes.
This article feels like an article designed to pressure Marc Lore to leave.
Losing $1B on $22B in revenue, after just 3 years of really starting this bet is nothing!
Not really. They were profitable, they just invested heavily in infrastructure (warehouses) and developing new services (AWS).
Amazon lost about $2 billion in their first six years of operations.
And Walmart's online presence would be profitable now if they weren't investing heavily in infrastructure (20 fulfillment centers trying to catch up to Amazon's 110) and new services (online catalog to match Amazon's).
That's a really big claim. No, technically they were not profitable for several years. Then, in the last 10-12 years, you are right that they invested heavily in R&D and everyone knows that one story.
1996: -$6.4m on $15.7m sales || 1997: -$32m on $147m sales || 1998: -$109m on $609m sales || 1999: -$605m on $1.63b sales || 2000: -$863m on $2.76b sales || 2001: -$412m on $3.12b sales
In 2002, as a forced result of the dotcom crash and stock market plunge (their ability to continue to fund such red ink was in question), they had to expedite getting to operating break-even and turned off the spending spree they were using to get big artificially fast. They turned a $64m operating profit in 2002 on $3.9b in sales. Positive operating income climbed to $440m by 2004.
Maybe it's my limited experience, but it always seemed to me that the people that shop at walmart genuinely enjoy the idea of shopping at walmart (going to the physical store to get a good deal on a product) and aren't the type to buy walmart products online.
Their products aren't even that good, surely more of them aren't going to hold up to online competition either.
I also never got the feeling that walmart shoppers are "i need same day delivery" types. they're in it for the bargains. You tell them an option is going to be slightly cheaper, they'll go for it.
I feel like they should keep the focus on their brick and mortar stores and forget about trying to compete with amazon.
I always felt like people go to wal mart just because it has everything and it's cheap. And their products have always been fine for me. Recently bought a ton of stuff there for my first bike and no complaints.
Walmart has been known to put pressure on brands to reduce the cost of their products. Sometimes they can find the cost savings in the economy of scale of doing business with Walmart. Sometimes they find cost savings by making a cheaper product.
Buying something from Wal-Mart is far from a seal of quality.
Same! I received a 20,000 mAh store-brand battery from WalMart a while back, and it works really well, was a good value, and can run a Pi forever. Same goes for the HDMI -> RCA adapter of theirs that I literally asked my mom to get (she's not technical, and managed to get exactly what I needed, which is great!)
Yay, WalMart! (And Best Buy, for that matter- their online pick-it-up-in-five-minutes option is amazing.)
Nope. I shop at Walmart and hate the experience of going to the store. I just hate it less than the counterfeit products on amazon or getting ripped off elsewhere.
That's an outdated stereotype. I think they're really moving in the right direction.
Their deliveries are on point, the self checkout works perfectly, they're even a store pick up service where you just pull up to designated parking stops and the attendants load up your trunk with order which is ready by time you arrive at the shop.
It's a lot harder to get your product on a Walmart shelf than having it listed on Amazon. There's an existential quality assurance when you buy from Walmart than Amazon.
> One other factor to keep in mind, though it’s unclear if it contributes to the Foran-Lore tension: In past years, Foran’s annual performance bonus has been heavily tied to the operating profit of Walmart’s US business, which includes the e-commerce division that Lore runs. Walmart’s US operating profit hasn’t, however, factored into Lore’s annual bonus.
Lore is operating like a startup, not focused on short-term profits.
Meanwhile, Walmart's US CEO, Greg Foran has his compensation tied to annual results, which include Lore's operations.
If accurate, this reads like Incentives 101, and it reflects poorly on Doug McMillon, Walmart's overall CEO.
The Amazon model doesn't "scale" to multiple companies because it is winner take all. It's a platform.
What could become an alternative would be a public decentralized protocol that many different retailers, warehouse operators, and delivery drivers could plug into. That is the sort of thing that could give consumers the selection of Amazon without putting control over everything in the hands of one company.
I'm not sure Walmart really needs "millions" more products. Amazon's largest problem are low grade, poor quality goods and actually being able to choose between them all. If Walmart can cover a significant number of categories with a couple of known and quality options, they can definitely make inroads.
Walmart also has a huge network of actual stores, and I've ordered more than once for delivery at a store. The bigger issue is mindshare and branding. I often don't think to look for something at Walmart and it's often only in frustration of Amazon's abundance of choice or other issues I'll think of Walmart.
Beyond this, there are lots of other things that are just there at Walmart, and often don't need delivery to me, the store is enough. Walmart, iirc, covers something like 85% of the U.S. population with a store within 5 miles. That shouldn't be underestimated.
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[ 2.8 ms ] story [ 194 ms ] threadThe problem is the same that Target, and Barnes and Noble all have in competing with Amazon. Their sites aren't as good. They are spartan, uninteresting, hard to navigate, difficult to find things, and often so slow as to be unusable.
In short their developers, development managers, server staff, etc, aren't good enough.
On Amazon I can find what I need, the site looks good in all browsers including old ones, it doesn't bog down the CPU, stall or crash the browser, and products can be found using their own search mechanism without having to resort to using Google.
I wonder how many other places are just being bad amazon clones when their core value is something different...
Being a place to wander around and browse but never purchase the merchandise is not a "core value" any retailer wants to have. Barnes and Noble is not a home away from home, it's a store, no different than any other. You're meant to buy something and get out.
The key part of that being "before buying." Many people will literally just browse and use the free wi-fi and some will read entire books and magazines in the store without buying anything.
Starbucks, for example, makes lots of money from people who are just there for the free WiFi.
That said, my local B&N has a Starbucks inside (and a Peets 40 feet away directly across a small street), but I doubt they get more than a small fraction of the revenue from the Starbucks, and at around 4-5 times the floor space as the Peets.
Of course, the advantage of B&N is that anyone can pop in anywhere. A library doesn't make as much sense in an airport or mall.
Maintaining a large inventory of books is a financial burden for bookshops. For that reason, most massive bookshops in North America and Western Europe have slashed their book inventory heavily compared to the 1990s. In the place of books, they prefer to sell trendy things like vinyl records, Kikkerland products, teas, etc.. However, while a customer can spend a few minutes looking at what’s available, this kind of inventory does not offer many opportunities for “exploring”.
Also, even if customers would not order from B&N online, they might still order a book they see at B&N from Amazon, perhaps even while they are inside the B&N. Smartphones allowing customers to browse in your store and then order a desired item for cheaper from your competitor, were not yet a thing back in the 1990s when B&N was in its heyday.
Walmart is notorious for having terrible compensation for their tech staff--staff who are motivated to look elsewhere due to poor compensation aren't going to do good work no matter how good they are.
People work for a variety of things, but comp and colleagues are high on my list. If you give me crap for both and I have options to go elsewhere, you’ll be left with people who don’t have options to go elsewhere. They’re probably not going to end up being the cream of the crop.
Basically, you need competent people at every level. That said, since the competence of a level is directly controlled by the level above it, I guess it does just boil down to bad execs now or at some point in the past (or a good strategy not just working. The world isn't that deterministic).
This is not necessarily true. FAANG have great compensation and excellent reputations regarding the technical capabilities of their employees but people leave them or choose lower compensation offers at smaller companies over their offers all the time.
My point is: your observation that FAANG developers do accept lower comp for work elsewhere is not very convincing.
It happens frequently enough.
A lot of places see the website as just like a print media poster site to outsourced to the lowest cost provider and don't realise that it is now a core competence.
I'm going to assume even the smallest change to improve things requires a few months of meetings before its implemented. This quickly depresses anyone even halfway good at their job and they leave.
A company is losing money to give customers better service.
Its not selfless, but its a phenomena.
I have never enjoyed shopping more than with Walmart grocery pickup. And Walmart online is superior to Amazon (cost alone).
Is it bad to employ low wage workers?
I am unsure how they reach this "achievement." I didn't think any close to modern website could act like ESPN in loading 32453235 scripts per page...
And please... Fix it so I can search for in-store only items.
Amazon.com (logged in) was 12MB, with 28 scripts.
(Disclaimer: Anecdata for my system, obviously.)
There are substitutes for AWS, but the switching cost is relatively high. Whereas for toothpaste, breakfast cereal, toasters, books etc etc the substitution is perfect (I can buy the same brands from many companies) and switching cost is low (I pull out a credit card).
Insofar as Amazon has a large free cashflow coming off AWS after capital improvements, it can use that money to (a) attract cheap funding from Wall St to (b) build, build, build.
https://twitter.com/ajassy/status/1060979175098437632
I will say, Amazon's above the fold paint was faster, but it did load a LOT after that.
Their landing page doesn't have a filtering option, but the bar at the top of the search results page has a "Store Availability" option.
Loads fast, looks clean, seems to work fine.
The main problem is most of the images are extra large and poorly optimized (they are all preloaded it seems, as Next.js does automatically). Even on my fast fiber connection it flashes.
For example, this product image is 63kb:
https://jetimages.jetcdn.net/md5/f442c4124ca2fb7537503a592a7...
But on the page it’s only loaded 360x360 px but are downloaded at 700px.
Amazon's above the fold render does appear a little faster, but their total payload and load time is much larger/slower.
You are describing a benefit, not a drawback.
1: https://www.npr.org/templates/transcript/transcript.php?stor...
1: https://www.npr.org/templates/transcript/transcript.php?stor...
It also points towards the ability of other companies to compete with Walmart in niche areas (at least niche compared to Walmart). I could see a future where a few chains each carve out a chunk of the more popular Walmart inventory and out-compete Walmart on physical location, as Dollar General has done.
You can kind of imagine them as CPU cache layers. In-town local stores are L1 cache with great speed but relatively poor choice for all but the most common items, Walmart is L2 cache with good speed (not still slower for most, as it's a ways away for the majority of people) and better selection, and the internet is general memory with everything you might need, but slow speed. There has been a major upheaval in the L! level because of both a major shift in how close/fast and large L2 got (a shift from major cities to large complexes in rural areas) and a huge boost in general access (the internet), but I don't think it's all played out yet, since I think there's still need at the local level that's not fulfilled well anymore.
Sorry for the tortured analogy, but it did probably save time on both ends.
Intro: https://en.m.wikipedia.org/wiki/Monopolistic_competition
A competitor to Walmart would be in grave trouble (and shouldn't even try) if their gross margin was 1-3%.
This is of course the opposite of monopoly, and a Good Thing!
https://en.m.wikipedia.org/wiki/Monopolistic_competition
It would be good if someone managed to pull off "we're the trustworthy go-to, for supply chain integrity and real reviews, and we treat all suppliers/brands/workers/customers with a reasonable degree of respect". Walmart would have a long way to go for that, but could they possibly manage the corporate will to do it, out of desperation?
That said, credit to them for identifying an area of strength (grocery delivery) and leaning into it hard.
[1]: Amazon was founded in 1994, Jet.com founded in 2014.
EDIT: Also wow, this article needs an editor. Is the CEO's last name McMillon (5) or McMillion (2)?
There's no way for us to know who is right based on reading one article.
Yeah, unfortunately this is very common. There are good reasons for this. If you're a public company, your financial health is being constantly scrutinized by wall street which will punish your stock price (and thus, executive compensation as well). Which incentivizes short term planning, and long term investments need to pay some sort of dividend, or else it will become a closely scrutinized and wildly unpopular.
Their stores are also pretty shabby. They entered Brazil buying Bompreco (which was not well run at all) and then they bought the Portuguese Sonae (which was reasonably efficient) and proceeded to weed out the good parts in order to homogenise the whole operation at the lowest possible quality.
Sonae had a really good POS on which you could even sell advertising space. It was replaced by a POS that looks like a 40 column DOS application.
I have to say, I know of no large store with any passable POS on Brazil. They are all horrible.
It seems that WM just goes into markets with not enough planning.
The brand means nothing to me, where walmart.com does at least have some brand presence.
I suspect it was simply the founders ego that kept jet.com as a separate site (rather than focusing on walmart.com). That alone is a bad sign, how many years have been wasted promoting Jet?
What a naive CEO!
Walmart.com is not Jet.com. They actually compete against each other! Why any corporation would run two separate ecommerce operations that compete is beyond me.
- When Walmart bought Jet.com, they already had Walmart Marketplace, which is very much like Amazon in that it's products stocked, sold and shipped by Walmart themselves - but also many 3rd parties which stock, sell and ship on Walmart.com too.
- Just like on Amazon - most customers are not aware they're not buying directly from Walmart. Unlike Amazon, there's no built in messaging system (you end up directly emailing customers, and until recently they didn't even proxy the email addresses - meaning you obtained customer's real email addresses). Returns are sloppy and painful for the seller to handle, and the Seller Central UI hasn't changed in years. It's a "modern SPA" website, but each button click must be doing some poorly designed queries or something terrible, because each view takes multiple seconds to display (showing a busy spinner gif while waiting). This makes doing trivial things very painful in the UI.
- Walmart.com's API isn't stable either. It's on version 3 now, and still seems to lack important features like advanced reporting - features Amazon has had for the decade we've been selling there. When version 3 of the API rolled out, they gave everyone a months notice that all previous versions would be "deprecated" - although someone at Walmart things deprecated means turning it off completely. This left anyone foolish enough to integrate with this clunky API 1 month to rewrite everything since it was a major change.
- You still have to be invited to sell on Walmart.com. Unlike Amazon - not anyone can just apply for an account and start selling. This is a two-edged sword, of course. While it cuts down on random people selling out of their garage - it does limit the diversity of products and sellers on Walmart's Marketplace - and ultimately revenue Walmart.com can bring in.
- Walmart offers no "Fulfillment" options for their 3rd party sellers. While this is currently not necessary, since you must be a legit ecommerce business of a considerable size to even be invited to Walmart.com, it would be a great option for many to help cut down on delivery times and shipping fees by stocking some products on the other coast, or throughout the country. Many large operations on Amazon take advantage of the FBA program specifically for these reasons.
Now speaking about Jet.com - I'm not sure why Walmart didn't fold them into the Walmart.com branding. It's a disaster. It's been 2 years since we seriously looked at Jet.com, perhaps some things have changed - although I have my doubts due to how Jet.com wanted to operate.
We also have a Jet.com account - but chose not to participate because the barrier to entry was too high for such low projected sales.
- Jet.com requires API use to do anything. There is no Seller Central UI to manage products or orders.
This requires an API to even list a product. No CSV or Flat File uploads, which both Amazon and Walmart allow. No manually editing product details for a listing, or manually reviewing your orders via an Order Manager page.
While that may be good in that it makes the barrier to entry high enough to keep out casual garage sellers - it also kept out larger profitable operations like us. We took one look at it, reviewed their API, and decided it wasn't worth the development effort to get a handful of sales each week. At the time, there were no good integrations that we could just pay for either - not to mention they wouldn't integrate with our ERP software either - so we'd still have to spend the development time anyway.
Essentially, Walmart Corp is trying to run two, competing ecommerce websites - both with serious flaws that prevent either one from being easy or enjoyable for their sellers. Being custo...
I imagine the same reason that Ford bought Jaguar. Segmentation.
Walmart bought Jet back before Jet had any real market share. Most figured they bought Jet to aquire their technology and people, namely Jet's founder.
And there's nothing shared between Jet.com and Walmart.com - unlike Ford being able to build Jaguar's in the same factory, or benefit from shared economies of scale. Walmart doesn't even sell on Jet.com, it's purely 3rd parties.
This article feels like an article designed to pressure Marc Lore to leave.
Losing $1B on $22B in revenue, after just 3 years of really starting this bet is nothing!
They may have been unattractive by wall street's standards (eg. Pay outs) but they were far from unprofitable.
Amazon lost about $2 billion in their first six years of operations.
And Walmart's online presence would be profitable now if they weren't investing heavily in infrastructure (20 fulfillment centers trying to catch up to Amazon's 110) and new services (online catalog to match Amazon's).
1996: -$6.4m on $15.7m sales || 1997: -$32m on $147m sales || 1998: -$109m on $609m sales || 1999: -$605m on $1.63b sales || 2000: -$863m on $2.76b sales || 2001: -$412m on $3.12b sales
In 2002, as a forced result of the dotcom crash and stock market plunge (their ability to continue to fund such red ink was in question), they had to expedite getting to operating break-even and turned off the spending spree they were using to get big artificially fast. They turned a $64m operating profit in 2002 on $3.9b in sales. Positive operating income climbed to $440m by 2004.
Their products aren't even that good, surely more of them aren't going to hold up to online competition either.
I also never got the feeling that walmart shoppers are "i need same day delivery" types. they're in it for the bargains. You tell them an option is going to be slightly cheaper, they'll go for it.
I feel like they should keep the focus on their brick and mortar stores and forget about trying to compete with amazon.
Buying something from Wal-Mart is far from a seal of quality.
Yay, WalMart! (And Best Buy, for that matter- their online pick-it-up-in-five-minutes option is amazing.)
Their deliveries are on point, the self checkout works perfectly, they're even a store pick up service where you just pull up to designated parking stops and the attendants load up your trunk with order which is ready by time you arrive at the shop.
It's a lot harder to get your product on a Walmart shelf than having it listed on Amazon. There's an existential quality assurance when you buy from Walmart than Amazon.
Makes me think Marc Lore has run afoul of and/or transgressed some ideological prime directive and this is a hit job.
Lore is operating like a startup, not focused on short-term profits.
Meanwhile, Walmart's US CEO, Greg Foran has his compensation tied to annual results, which include Lore's operations.
If accurate, this reads like Incentives 101, and it reflects poorly on Doug McMillon, Walmart's overall CEO.
What could become an alternative would be a public decentralized protocol that many different retailers, warehouse operators, and delivery drivers could plug into. That is the sort of thing that could give consumers the selection of Amazon without putting control over everything in the hands of one company.
Walmart also has a huge network of actual stores, and I've ordered more than once for delivery at a store. The bigger issue is mindshare and branding. I often don't think to look for something at Walmart and it's often only in frustration of Amazon's abundance of choice or other issues I'll think of Walmart.
Beyond this, there are lots of other things that are just there at Walmart, and often don't need delivery to me, the store is enough. Walmart, iirc, covers something like 85% of the U.S. population with a store within 5 miles. That shouldn't be underestimated.