Amazon Ready to Take Walmart’s Low Price Crown
What would Walmart be if it were no longer thought of as
the low price leader at retail? It may not be a purely academic question for
long. According to Kirthi Kalyanam, director of the Retail Management Institute
at Santa Clara University in California, the world’s largest retailer could
face some competition on the pricing front and it is far from certain that
it will win.
"Amazon is actually in a better position than Walmart to be the price
Kalyanam, told The Christian Science Monitor. "Amazon has a lower
cost structure than Walmart."
Amazon also has some momentum on its side
as consumers go online to make a larger percentage of retail purchases.
this year appear much more willing to open their wallets and are turning to
online stores for the convenience of shopping wherever and whenever they like,
but also as their primary source of information about products and inventory
levels," said John Squire, chief strategy officer, IBM Coremetrics,
in a press release. "Retailers have done an exceptional job across the
board of appealing to consumers with highly personalized promotions and a slew
of free shipping promotions."
Perhaps seeing its price advantage being
eroded, Walmart has also turned to offer free shipping on online orders as
well as in-store pickups. The retailer is offering free shipping on 60,000
gift items through Dec. 20 with no minimum purchase required.
Discussion Questions: Is Walmart in danger of losing its low price advantage
to Amazon? What would it mean for the chain if it did? Is Amazon’s model
destined to be more efficient than Walmart’s?
- Wal-Mart: Is Amazon replacing it as low-price leader? – The Christian Science
Monitor/The Associated Press
- Cyber Monday Online Spending Surpasses Black Friday Online, Reports IBM – IBM