HOW DOES A TRADITIONAL BRICK;AND;MORTAR retail operation beat back the likes of Amazon? Lowering prices is
not the only answer. In fact, dropping
prices may just lead to less profit for
any retailer foolish enough to think that
consumers are considering only price
when they decide to purchase online.
Walmart may actually have one
answer that could help somewhat
level the playing field between tradi-
tional retailers and digital operators.
In late February, the chain took a big
step that shows it is paying attention to the changing shopping patterns and demands of its customers. It
announced an upgrade to its mobile
app that will allow shoppers using
its pharmacies and
money services to skip
paperwork and save
time waiting in lines
by using express lanes.
Walmart officials say
that consumers will
be able to refill prescriptions using their
smartphones and pick
up their orders quickly
express lanes. A prescription’s code will be
scanned through the app, which will
also allow for electronic payment.
While always known for competitive
pricing, and committed more than ever
to an online strategy, officials at this
giant chain may have finally realized
that the in-store shopping experience
may be more important than how
much consumers pay.
There is no doubt that Walmart
is learning about the new retail the
hard way—kind of an on-the-job lesson in what to do to keep up with the
Amazons of the world. Amazingly, just
a little over a year ago, the chain was
viewed as the joke of retail. Today, just
12 months or so later, it is again the
darling of Wall Street and Main Street,
producing higher same-store sales and
profits, and making a little progress
against Amazon in the brutal online
segment of the industry.
The success of the in-store part of
this equation is not luck. Instead, it has
been a concerted effort by the company to clean up its act, including creating a more hospitable atmosphere in
its stores and paying its workers a bit
more. We all know the equation: Happy
workers eager to help out the shopper
often translates into happy customers
who spend more money at the store.
Ironically, Walmart was the company
that changed the face of retail more
than a generation ago. The Bentonville,
Ark.-based chain’s emergence on the
national scene in the 1990s caused
havoc for many other retailers that
could not compete on pricing and
selection. Many retailers—notably a
number of regional discount chains—
failed during that period. Everyone
else, it seemed back then, was simply
waiting for the axe, paralyzed by fear
that they could not compete.
The rest of the retail industry did not
fail because many of these merchants
realized that pricing was not the only
key to successful retailing. Offering
consumers a unique, pleasant and
convenient shopping experience can
sway a large number of shoppers away
from the low-price leader and back
into their stores. Being ahead of the
curve—or at least riding the wave—
can make a retailer seem more in tune
with its customers, who now have
more and more options for their shop-
Walmart officials better not rest on
their laurels here. The job is not done.
In fact, it will never be done. Amazon
and other online entities will keep the
pressure up with their own new technologies. But this, at least, shows that
Walmart officials understand that they
must offer their shoppers the latest
innovations to keep them satisfied
with the overall shopping experience.
Perhaps other retailers can learn a
lesson from all of this, too.
RIDING THE WAVE
Being ahead of the curve—or at least even with it—can make a retailer seem more in tune with its customers.
By Seth Mendelson
Seth Mendelson is publisher
and editorial director of Grocery
Offering consumers a
unique, pleasant and
experience can sway
a large number of
shoppers away from the
low-price leader and
back into their stores.