Why There Will Never Be A Wal-mart Of The Web

By Author: Michael Healey
Total Articles: 1
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There's a very interesting battle going on that every company should be watching. Amazon and Wal-Mart have gotten into an online war over book prices, matching each other's pricing hourly. Walmart.com CEO, Raul Vazquez, has proclaimed, awkwardly, that Walmart.com wants to be "the Wal-Mart of the web."

Hmmm... In traditional retail, Walmart is famous as a category killer, moving into a region and dominating the local retail space. For manufacturers, it also means dealing with some brutal purchasing requirements in order to get onto their shelves.
Online, there are a different set of channels, systems, and buyer requirements that makes it nearly impossible to achieve the level of control over consumers or manufactures including:

Geographic Reach - The web is an open field for getting clients. A large Company like Wal-Mart may spend heavily on pay per click ads or organic search marketing, but these are only two of the tactics to gain clients. Other strategies such as integrated email campaigns, referral networks, and simply delivering better quality information about products can catapult a site ahead of the ...
... others.

Comparison and Choice - The web can be considered Adam Smith's high tech dream, where there's a free flow of pricing and consumer information unlike any other channel in the world. Nobody beats Wal-Mart? Check prices online and you'll be surprised. This comparison is bolstered by multiple referral engines that attract millions of buyers who like to comparison shop.

Product Availability - Wal-Mart is famous for making manufacturers jump through hoops to get into their stores. Online, major players such as Amazon and Sears have made it exceptionally easy to be added to their marketplaces; they want to attract as many potential customers as possible and want as many products as possible.

Plus, the vast majority of manufacturers have added direct purchase options to their sites, often using backend partners for fulfillment. A recent study of 13,000 web users showed that 2/3 visit an original manufacturer's site as part of their buying process. Building your brand online gives you a stronger position in every channel.

Multiple Sales Channels - Perhaps the most compelling reason of all is the fact that the web isn't just a group of ecommerce sites; it's a series of distinct channels of distribution. The 'ETail' category that Wal-Mart refers to only accounts for 23% of total Internet Sales. The rest of revenue comes from the other channels including direct manufacturers sites, auction systems, supply chain engines, referral systems, knowledge sites, and yes, even social networking.

The Web has evolved from a marketing or support function to become the core part of an organizations sales and distribution strategy. However, companies often mistakenly think of the web a 'one' Internet. A Company should segment the web into seven distinct channels mentioned above. Each has their own competitors, search patterns, and set of buyers. Companies need to understand all seven, making sure you or your partners have the required sales presence as needed.

Michael Healey is the President of the Yeoman Technology Group. The Company offers consulting and management services to help Companies optimize their sales and distribution strategies. Learn more at http://www.yeomantechnologies.com.