Friday, December 26, 2014

Walmart Investing In Its Prices To Compete With Amazon

I really believe that 2015 will be the year of a major fight in the Ecommerce industry.
Georges Plassat recent speeches on Amazon's strategy are not only to chat. Brick&mortar leaders intend to get marketshares quickly on the Internet. 

This is the reason why Walmart has decided to invest in its online pricing in order to catch up with Amazon. The price difference is narrowing, and I believe that Walmart has big plans on the Internet.

The price competition will hence become tougher as Amazon won't have any choice but to cut down its own price to keep its competitive advantage. As a result, the article shows that Compared with last year, prices are 12% lower at Wal-Mart, 9.7% lower at Amazon, and 3.5% lower at Target.  

As Georges Plassat said, traditionnal retailers have a competitive advantage in the Ecommerce game: They own stores network they developped over the years that will be hard to developp for a pure player (if they intend to do so). Amazon on the other end has plans to enter new categories to get business from brick & mortar retailers.

It will be interesting to see how things will go.