Walmart+ will be an expensive folly. Here's why
Walmart is working on an Amazon Prime competitor called Walmart+ that could launch next month.
According to a report by recode, grocery delivery is at the core of the offering, although the plan is to add various perks that Amazon can’t easily match. These include fuel and prescription drug discounts.
Attempting to imitate its arch rival is a terrible look for Walmart, argues Shlomo Chopp, Founder and CEO, Anchor Shops. “You had them out-positioned with physical locations and failed head to head, so now you base your strategy on a copy?” he comments.
“The question the Walmart exec team needs to ask themselves is not ‘how will Wall Street award us for attempting a proven concept like Prime’, but rather ‘how will it look if we fail at an imitation?’ You are a short drive from every shopper in the US and can deliver for cheaper like Target who decided to compete with Amazon by doing an end-around, not use their strategies,” he adds.
Despite significant investment, Walmart’s website is not in the same league as Amazon’s and it hasn’t been able to use its stores for localised fulfilment. “They think Prime like icing will enhance a tasteless cake,” Chopp argues.
Amazon now accounts for nearly 40% of all online retail sales in the US, according to eMarketer, and Prime is a huge reason why. Walmart is in second place, with only a little more than 5% of the US e-commerce market.
Keep on innovating (and Walmart has impressed with various cutting edge omnichannel projects in recent times) or start copying? That is the question. Walmart+ is a top priority for Chief Customer Officer, Janey Whiteside, according to sources.
You can’t out-Amazon Amazon. For the reasons outlined above, this initiative has all the makings of an expensive folly.
