Walmart eCom Success Case Study – What Can You Learn From Them
Thursday, Walmart reported that their e-commerce growth was soaring through the company’s first fiscal quarter. Coupled with robust organic sales figures, data suggests that rival Amazon might be in for a fight.
Online sales for Walmart grew a jaw-dropping 63 percent, in just this one quarter. This was possibly directly a result of the company’s recently upgraded mobile app and free two-day shipping rollout.
CEO Doug McMillon featured a company quarterly conference call to go over the news, pointing out that the business is moving quickly to combine both physical and digital assets, while making shipping faster and more affordable or even enjoyable for consumers. He did note that they still believe there is room for improvement in both online areas and physical stores, and they’re working on both for additional results.
Earnings per share rose up to a full American dollar over the course of the quarter, which was 2 percent higher than earnings a year ago. Their total revenue rose over a percentage point to $117.5 billion. On the constant currency basis, their revenue went up 2.5 percent to around $118.8 billion.
Their domestic net sales rose almost 3 percentage points, going from $73.3 billion last year to $75.4 billion now. The company issued a fiscal second-quarter guidance of anywhere from $1.00 to as much as $1.08 per share, with the exclusion of a nickel per share benefit from the selling Suburbia, which was a Mexican apparel outlet.
Same-store sales for a 13-week period ending July 28 are anticipated to go up 1.5 to 2 percent for American Walmart stores and 1 to 1.5 percent for Sam’s Club locations.
Walmart’s shares rose 3.2 percent Tuesday for a $77.54 close per share, which was the highest recorded price in around two years. By mid-day Friday, the stock wound up hitting an all-time new high of $79.44.
What Is The Secret Behind Walmart’s eCommerce Success?
The focus of Walmart recently has been on enhancing the consumer experience. Corporate leadership has notable switched emphasis from cost controls and expense management to customers, and it’s paid off with online sales booming over 60 percent.
Walmart has tremendous advantages over other big box retailers it rivals with, in that they’re in the same arena as Amazon and competing with them. The sheer size and survivability means they do not have to close stores like other retailers do when they haven’t created a differentiated experience for customers. This approach is already known to be used by Adrian Morrison and is used in his course eCom Success Academy course.
While the rivalry with Amazon makes Walmart strong, it’s also always a threat, given that Amazon is a robust and challenging rival. Membership totals in Amazon Prime have doubled the last two years, going over 80 million. On average, a Prime customer spends almost double the $700 a non-Prime Amazon customer does, according to Consumer Intelligence Research Partners data.
Walmart has made a number of serious moves in attempting to challenge the domination of Amazon over the free shipping business it draws thanks to its exploding Prime membership. It also took a number of steps to enhance the in-store shopping experience for consumers who like going into brick and mortar Walmart locations.
The company earlier in this year had announced plans to make free two-day shipping an option on over two million items throughout its inventory. It even lowered the minimum total required for free shipping to residential consumers to $35, when it had previously been $50.
The company also upgraded certain features of its mobile app so that it could speed processes involving money services desks and in-store pharmacies. These updates gave customers of the app the power to use express lines in both of those departments, doing things like checking on pharmacy prices or electronically ordering refills. On top of that, updates allowing the prefilling out of money transfers as well as other financial services became possible.
Last month, the company moved to save so-called ‘last mile’ delivery costs by utilizing existing physical stores as actual fulfillment centers, giving discounts to customers on particular online-only merchandise if they chose to instead pick them up in a store.
These discounts at first applied to roughly 10,000 items normally bought online. However, the company anticipates that over a million items are going to be eligible for those discounts as soon as next month.
Walmart is certainly making strides in terms of its online grocery-specific business. At the end of the reported quarter, it was operating at nearly seven hundred locations with plans to increase that segment of the company to more stores both domestically and internationally.
Walmart’s also made a number of acquisitions, which included names like Moosejaw and Modcloth. It’s also rumored to be in high-level conversations with possibly buying the men’s retailer of Bonobos for roughly a third of a billion. All of that follows last year’s acquisition of Jet.com, which was over three billion dollars. On the other hand, Walmart still maintains it has plans to grow its own e-commerce through organic means and process.
The current online inventory appears to be substantially more than it was a year ago at the time of writing this. Over fifty million items were available online from Walmart’s site, including both selections only from Walmart as well as third-party vendor offerings.