- How is Wal-Mart’s Website different from Amazon and Office Depot?
The major difference in the website of Walmart and that of the Amazon and Office Depot is in its web design. In the realization of this fact, Walmart acquired a web design company and tasked it with the responsibility of rebuilding the entire website of the company in order to make it more seamless. Additionally, the products that are featured on Walmart’s website are basic products that are needed in everyday life of its consumers, unlike the other two competitors. Walmart’s website is also different from that of Amazon and Office Depot because it offers the opportunity for its customers to buy products online, but rather than wait for the delivery to be done, which could potentially take a long time, they have the option of picking the products at their local Walmart stores. This, unlike Office Depot and Amazon, offers the convenience of online shopping and speedy acquisition of the goods.
- Does Wal-Mart and Best Buy face the same problems or different ones?
Best Buy and Walmart are both American multinationals operating in the retail business. It is true that these two multinational retailers face problems. However, these problems are more different that they are similar in nature. One of the recent problems that Walmart has had to endure was that of predatory pricing. In fact, many competitors have attempted to sue Walmart for selling merchandise at a very low cost in order to edge out competitors in the market. For instance, in the 1995 case of American Drugs, Inc., vs. Walmart Stores, Inc., the drug retailer argued that Walmart was selling items at a cost that was too low with the intention of destroying competition and injuring competitors. To Walmart’s relief, American Drugs., Inc lost the case at the Supreme Court in Arkansas.
Similar accusation was leveled against Walmart in 2000 by the Department of Agriculture, Trade and Consumer Protection in Wisconsin for selling milk, butter, laundry products in addition to other staple products at extremely low costs. The accusation was that the retailer intended to force out competitors in order to monopolize local markets. It was determined in 2003 by a German High Court that its low cost pricing strategies undermined the principle of competition. Alongside two other retail outlets, Walmart was ordered to increase their prices. Although the retailer won the appeal, the appeal was overturned by the German Supreme Court resulting in the sale of all its stores in the country.
Another problem that has faced Walmart is labor and employee relations. The retailer boasts of 2.2 million global employee force. The labor issues that the retailer has faced include poor working conditions, low wages, the strong anti-union policy that the company has adopted as well as inadequate health care. Statistics shows that the employee retention at Walmart is very low, with over 70% of its workforce leave before the end of the first year. The problems with low wages amounting to 10.11 dollars an hour. Overall, the annual wages are opined to be less than the needs of a two person household by 10000 dollars. There has also been accusations that the pay caps instituted by the retailer on highly paid working veterans were attempts to push them out of the company (Brunn, 2006).
On the other hand, Best Buy is faced by problems of warranties. Consumers from Florida leveled a lawsuit against Best Buy for fraudulent business practices that related to the sale of service plans for its electronic products. In the lawsuit, the plaintiffs argued that the retailer misrepresented the warranties offered by the manufacturers so that they could sell their own product of service replacement plans. Additionally, the retailer has endured claims that legitimate service plan claims were denied to those customers who bought the extended service plans. Other problems that Best Buy faces are in the nature of misleading prices. An investigation into this issue was ordered by the Attorney General of Connecticut after allegations that an in-store website misled the consumers on the prices of various items.
In 2009, a Smartphone was erroneously sold for 99.99 dollars against a marked price of 199.99 dollars. Another problem the company has endured was the sale of analog television sets without alerting its customers that such televisions would become virtually obsolete after the transition to the digital broadcasting a year later. This contravention was slapped with a 280,000 dollar fine by the Federal Communications Commission. The other concern that the retailer has endured is of an environmental, nature with the company being named in 2007 by Greenpeace as one of the companies that purchased raw materials from companies involved in the unethical destruction of Taiga forest in Canada. This brought up issues of energy inefficiency and poor waste management.
- What customers shop at Wal-Mart, both in-store and online?
With annual sales of over 490 billion dollars and stores in over twenty five countries, Walmart is the largest retailer in the world. It is important to focus on the demographic characteristics of the people who shop at Walmart. Walmart operates its retail outlets by offering the lowest prices among its competitors. In this regard, the largest proportion of people who shop at Walmart are those people who are interested in obtaining products at low prices. This demographic of people does not necessarily include the anecdotal low income earning households. Frugal people in the higher income bracket might also be interested in lower prices at Walmart because of the potential savings compared to other retail outlets. For instance, inflation of foodstuffs has households, both in the lower and middle income bracket reeling with a financial burden. Walmart offers a reprieve for such households because over and above selling their products at lower prices compared to other retail outlets, they offer other incentives. One of these incentives is a variety of branded products on the shelves and the use of coupons to attract more foot traffic. As such, people are spoilt for choice of less expensive brands. Additionally, the customers can also use coupons in order to make savings on the budgets (Epstein, 2004).
According to statistics by Walmart, more than 90% of people in the United States of America live within fifteen minutes of a Walmart retail store. However, the 10 billion dollars in online sales indicates another group of people who shop at Walmart online stores. Online shoppers are people who enjoy the convenience of shopping without leaving the comfort of the homes. This group of shoppers is willing to spend three percent more than the market price a product in order to make lesser trips to the physical stores. This group of people is also motivated by other factors in order to shop online. For instance, online shoppers from geographical locations that are further away from physical stores, shop online in order to save on prices of gasoline. The electronic commerce business at Walmart is dependent on this group or people. It is exactly for this reason that Walmart has enabled different payment options in order to enable online shoppers to make online payment with ease (Chen, 2008).
Another demographic of people is increasingly shopping at Walmart, according to market trends. More precisely, this demographic is the fastest growing demographic, according to statistics dating back to 2007. This demographic includes American citizens and other nationals earning in excess of seventy thousand dollars annually. From the year 2012, the number of shoppers from this demographic has increased by twelve percent. Additionally, a younger demographic that are very particular about labels and brand names are also finding their way towards Walmart for their shopping. This was the focus of the retailer’s promotional strategies in the year 2008. This notwithstanding, the major focus of the retailer is customers in the medium income bracket. This is especially because this demographic of people account for forty-two percent of the customers shopping at both retail stores and online stores at Walmart. This is a demographic with an annual income of less than forty thousand dollars.
- Determine a strategy for Wal-Mart to improve online sales.
A developing trend for many of these retail outlets is the fact that most of their consumers are going digital. As such, any retailer hoping to increase its online sales must focus on this changing trend. In this regard, any attempt by Walmart to challenge the online presence of an Amazon and Best Buy has to focus in the digitization of the prospective customers. The following aspects are important for the strategy by Walmart to improve its online sales: -
- Improving the retailer’s website: the web design of the company’s website needs to improve if the company is going to make headway in terms of online sales. In the previous financial years, Walmart has invested heavily in its e-commerce platform. Rather than hiring web designers to improve the state of their website with a view of making it more powerful, Walmart should acquire a web design company and task them with continuous improvement of the web design of the company.
- Social gifting: social gifting is a growing trend that is increasing online traffic in retail stores by exploiting the expansive and extensive presence of people in the social media. Using popular social media platforms like Twitter and Facebook, Walmart can give its customer gifts through personalized recommendations based on the profiles that these customers have on these social media platforms. This will increase the online traffic and also enhance customer loyalty.
- Search engine optimization: in order to improve online sales, it is important for Walmart to increase its online presence through its search engine. The search engine that is design should not only be user friendly, but also able to locate the items searched by the customers with relative ease and speed.
- Mobile applications: the potential for mobile applications are as diverse as the innovative ideas that people have. As part of this comprehensive strategy to bring up the online sales at Walmart, a mobile application is indispensable. In this regard, Walmart will not design a typical mobile application, but one with voice enabled capabilities. This mobile application is intended to be the interface between the customer and the store. The voice enabled capabilities are meant to accommodate users who might not the phones keypad to type. This could include people with disabilities to those whose hands are indisposed with other business like driving. The envisioned mobile application searches for the intended products and offers a list of the products including the location of the products in the customers local branch of Walmart. Additionally, the mobile application will offer product information, including any offers on the said products.
- The elements of this comprehensive strategy to bring up online sales are very important. However, this element is crucial to the success of the entire strategy. Part of the problem at Walmart is faltering in the shipment of products that are ordered from the online sales. There is also an element of price where competitor quote lesser prices compared to Walmart. In the spirit of low prices and the mortar to brick business model, Walmart should review its shipment charges so that they reflect the general philosophy of the retail outlet. Additionally, the number of days that products take to be shipped to the customers is of concern. Most consumers are not willing to wait a long time for their products to be shipped. As such, customers will migrate to those online stores that show expediency in their shipping and handling. In order for Walmart to compete favorably, it needs to reform its shipping and handling department in order to increase efficiency. In order to improve its online sales, Walmart needs to attract and retain more customers than other online stores. This can only be done if Walmart takes charge of the lead times in the shipping an handling of the products purchased from online stores. Considering that over 96% of American citizens and other nationals live within twenty miles of a physical store, Walmart can benefit immensely from this aspect of this comprehensive strategy (Canak, 2006).
Report
M/S: Walmart Company management
Attention: General Manager
Walmart is an industry leader in the retail market, and recently in the grocery market. The retail chain store has operated in many countries and boasts of sales of over 419 billion dollars. The company uses physical stores and online stores in order to reach its customers.
Introduction
This report will focus on the following areas: -
- The primary cause of the problems at Walmart.
- Manifestation of the problem.
- A plan for solving the identified primary cause.
- Explain the components of the solution.
- Describe the benefits emanating from the plan.
Findings
- Primary cause of the problem
- Manifestation of the problem
- The primary cause of the problems at Walmart is also manifested through low employee retention rates. As espoused earlier, seventy percent of employees at Walmart leave within the first year of employment. This is attributed to a host of employee welfare issues as has been discussed.
- Plan of solution
- Solving this primary cause requires the retailer to reform the organizational culture so that it is more empathetic to the welfare of the employees. This requires a number of elements in the organizational culture to be amended.
- It is imperative for Walmart to give priority to the welfare of its human resource. This includes a review of the minimum wages that the employees are paid, the scrapping of wage caps in order to allow highly paid veterans to continue working in the retail stores. The importance of these changes is underscored by the employee apathy in the retail chain store..
- The other component of the plan to solve the primary cause of the problems at Walmart has to do with employee welfare. This includes issues such as working conditions, health care and unionizable work force. For a while, Walmart has been criticized for wrongful termination of its employees due to issues that are arguably subjective. For instance, four employees were terminated after engaging with armed assailants in one of its stores in order to protect themselves. The termination was predicated on the policy that employees should desist when confronted by armed assailants in any of its stores. This incident caused widespread criticism from other quarters. Employees need to feel that even when their employment status is under review, a semblance of justice is accorded to them. Such employees will work with zeal because they know they are valued by the organization.
- Other issues that ought to be addressed in this plan have to do with the company’s policies regarding labor. Walmart has a strong anti-union policy for its employees. Labor unions are important in the human resource industry because they give their employees a collective voice when articulating their issues. Discouraging employees from joining labor unions speaks heavily of the temporary nature of the employment. This includes maintaining a workforce that dedicates itself to the organization. In the same breadth, and as part of this plan, Wlamart should closely monitor its overseas suppliers to ensure that they are not practicing using child and prison labor, accusations that have been leveled against Walmart.
- Benefits emanating from the solution
- One of the benefits of reviewing employee remuneration as part of the plan to solve the primary cause of the problems is that it will curtail employee exodus from the retail chain store.
- This will bring out the picture of an ethical organization, something with which Walmart should endeavor to be associated.
- It will help Walmart to embody business practices that ensure sustainability for the future.
- It will increase employee motivation and this will result in increased productivity.
Conclusion
Today’s corporations do not only endeavor to attract highly talented employees, but also to retain them for as long as possible within their ranks. This is because the labor market is saturated with semi skilled employees, who might require a sizeable investment in training. Corporations want to retain their employees in order to get a higher level of service delivery. It is arguable that the job specifications at Walmart are not very technical. But even so, employee retention is encouraged even for the most basic of jobs. Solving this primary cause of the problems will in turn solve many other problems that the retailer has been experiencing.
Recommendations
Walmart should change its organizational culture in order to effect the required changes in the human resource department in the company. These changes include reviewing the minimum wages for employees, abolishing the wage cap for veteran employees, allowing the employees to join unions and improving the working conditions.
