The e-business development of Wal-Mart Canada
Wal-Mart is one of the most prominent retailers in the United States. The retailer’s online shopping website walmart. com is one of the mostly visited websites in the United States. Founded in 1962 Wal-Mart is famous for its relatively low price products as compared to other retailers. It is by far world’s largest and most successful retailer. The company has 3,300 stores in the United States and about 1 million employees. In the given case study Wal-Mart has adopted two different e-business atomic models. Initially the retailer adopted the direct-to-customer model.
The primary strategy of waltmart. com was to by pass the costly bookstores, and lure the students to buy these books at cheaper price from Wal-Mart online store. Wal-Mart’s online store is an exemplar of the direct-to-customer business model, in which the retailer by passes traditional retailer outlets by providing the customers, convenience of saving their time and energy in shopping physically. (Weill, Vitale, 2001) In the current scenario the company has used the same strategy of direct-to-customer atomic model.
Moreover when Wal-Mart felt that it does not have enough resources to provide the wide variety of textbooks, the retailers adopted another e-business atomic, model i. e. shared infrastructure model. In this model the retailer joined hand with its rival Barnesandnoble. com. In the shared infrastructure model two or more competitors cooperate by sharing common IT infrastructure. In this case Wal-Mart shares its website with Barnesandnoble. com by providing a search option directed toward the competitors online database.
Therefore in the end the final strategy of Wal-Mart in the textbooks business was a combination of aggressive direct-to-customer approach and a rather benign shared infrastructure approach, which was mainly after the failure of luring the students in buying textbooks online. (Weill, Vitale, 2001) Speaking about the Wal-Mart Canada, there is no e-business strategy currently for the Canadian division of the company. The current business approach of the company is traditional transactional approach based on promoting sales by providing products at discounted price as compared to their competitors.
Critical Success Factors of Online College Textbook Retailers: Among many success factors of online college textbook retailers is the offering of textbooks at cheaper cost. Most online retailers provide books at a lower price as compared to traditional stores. Other factors include marketing based on special deals and offers, which motivate the customers, as well as offer of reselling the used books on better prices as compared to the traditional ones. Nearly all the online textbook retailers use, both the direct-to-customer and intermediary approach i. e. they not only act as retailers like Wal-Mart, but also as auctioneers like eBay.
Current e-business model of Wal-Mart USA: The Current E-Business model of Wal-Mart USA is a combination of direct-to-customer and Intermediary, as it acts as a medium or a selling point for different manufacturers as a retailer. The combination of these two models, with the support of strong logistics from its traditional stores, it has always enjoyed competitive advantage with its other competitors like amazon. com.
(Weill, Vitale, 2001) The company uses the same business model for both its B2B and B2C online transactions. Wal-Mart has used the advantage of its physical stores by integrating its online and offline channels, for e. g. the company has provided the facility of ordering pharmacy online and then picking it up at any local store, after showing the prescription. Moreover another strategy of Walmart. com has been moving upscale in certain merchandizes. The value proposition of Wal-Mart have always been lower cost, more selection and integration of online and offline services. (Chao, 2007)
The same business model is the most feasible for Wal-Mart Canada, as this approach will provide the Canadian branch the same competitive advantage over the local online retailers that it had enjoyed in the United States. With its strong logistic support in the form of hundreds of traditional stores, people are already aware of the retailer’s name. Thus technical savvy people will be very easily convinced to buy online, when they have been offered with discount prices and free shipping etc. Moreover providing the online shopping facility will require the development of the required infrastructure.
This include development of high-end database system, as well as redesigning the website to make it more interactive and dynamic, as well as easy to use. The website should be developed in such a way that an average user can easily find what he/she wants and there should be enough information about the product, which would provide virtual look and feel. The website should be media friendly, but not too much resource hungry like the boo. com. The company will also need to develop a secure online transaction system as the one the developed by its U. S. counterpart.