Kings of Retail: Can Amazon Knock Wal-Mart Off Its Throne?
The growth of Amazon (NASDAQ:AMZN) has been nothing short of meteoric. Over the past few years the company has turned the retail business on its head, knocking out competitors left and right and forcing itself to the top of the heap of online retailers.
This head-knocking hasn’t gone unnoticed by other retail industry heavyweights, and now, 20 years after opening its online doors, it appears that Amazon has finally kicked the proverbial hornet’s nest.
That hornet’s nest is Wal-Mart (NYSE:WMT), the undisputed champion of American retailers. The mega retailer, which made its name in the big-box weight class, is getting ready to bring the fight for retail dominance from its brick-and-mortar locations onto the virtual stage. While Wal-Mart does have an online presence, it’s hardly competitive with Amazon’s marketplace. Consumers are much more likely to simply jump in the car and make the trip to a physical Wal-Mart location to make a purchase than to use the company’s website, which consumers often use to simply check prices or store availability.
As Amazon does not hold physical store locations, the two companies have thus far had a major barrier to keep them separated, despite the fact that they both provide essentially the same services to customers. But Amazon has finally picked up enough momentum that Wal-Mart executives must be feeling the heat, and have decided to take action.
As reported by GeekWire, it looks as though Wal-Mart is taking the Amazon threat seriously enough that it is ramping up its online presence. Amazon occupies a space that has, for the most part, been untouchable by Wal-Mart, which is famous for opening up shop, undercutting the competition, and putting other smaller brick-and-mortar shops out of business.
Amazon’s online-only approach has left it invulnerable to that method, so Wal-Mart is taking the fight to the company. It appears to be paying off, as well. GeekWire says that Wal-Mart’s online sales in the third quarter were up 24 percent year-over-year on a constant currency basis.