Is Walmart’s Store No. 8 breaking boundaries or bonds with its core customers?
Walmart has continued to surprise the industry with its aggressive innovation efforts and acquisitions, including the purchase of hip women’s ecommerce site Modcloth, outdoor e-commerce retailer Moosejaw and the now defunct Canadian online footwear company, Shoes.com.
Last month at Shoptalk 2017, the company disclosed its intent to accelerate and nurture its application of cutting edge technologies with a Silicon Valley-based incubator. When announced, Marc Lore, head of Walmart’s U.S. e-commerce unit, said the initiative will help build “startups that have a responsibility to change the course of retail,” not just in the immediate future, but five and 10 years down the road. Dubbed “Store No. 8,” the news hit Monday that Rent the Runway co-founder Jennifer Fleiss has been tapped to spearhead its leading project, realizing “high personalized, one-to-one shopping experiences.”
It seems clear that this recent acquisition spree and development of Store No. 8 is geared toward attracting higher-income shoppers, a distinct departure from Walmart’s historically lower-income base. On the one hand, Walmart should be loudly applauded for its aggressive efforts towards proactively breaking old paradigms. Not only is management reaching far outside of its comfort zone but putting its sizeable weight toward reinventing retail overall. But by doing so, is Walmart also risking putting itself out of the comfort zone of its core customers?
Notable is Walmart’s “Project Impact” effort eight years ago when it sought to elevate the quality of its apparel and home furnishings, clean up stores and present friendlier customer service. The initiative was generally seen as a failure, many sources citing that people come to Walmart for price — plain and simple. The industry stated loudly that Walmart should stick to the formula that got it to where it is and resist expensive experimental diversions.
- Wal-Mart launches retail technology startup incubator Store No. 8 – Retail Dive
- Wal-Mart names Rent the Runway founder to lead first Store No. 8 project – Retail Dive
- Doesn’t Wal-Mart Inc. Ever Learn? – The Motley Fool
- RILA, Accenture launch tech innovation center – Retail Dive
DISCUSSION QUESTIONS: Do you think Walmart is breaking boundaries with its digital acquisitions and initiatives or damaging bonds with its core customer base? Do you see Walmart as the right retailer to lead industry innovation?