Market Overview

Wal-Mart Is Fighting Back

Wal-Mart Is Fighting Back

The current market conditions have caused many big-name firms to cut back in order to reduce costs and increase margins. However, for discount retailer Wal-Mart Stores Inc. (NYSE: WMT), this year is expected to be one of transition in which the firm reinvests in its growth and works to make changes that will help the store compete with a growing list of rivals.

Taking On Amazon

One of Wal-Mart's main objectives is to improve its online shopping offerings. The store is expected to spend around $2 billion on its e-commerce arm in an effort to make the experience faster, easier and more streamlined., Inc. (NASDAQ: AMZN)'s growing popularity has severely dented Wal-Mart's marketshare as more and more people turn to the online-retailer and the convenience of having products shipped to their doors.

Related Link: Wal-Mart Sees Decline In Online Sales Growth As Amazon's Online Sales Increase

Lowering Prices

Another big factor for Wal-Mart is price competition. The store has based its reputation on offering people the lowest price on the market, but in order to keep that promise the company will be spending billions to drop prices.

Over the past few years, Kantar Retail surveys have shown that Wal-Mart's reputation as a low-cost retailer is slowly diminishing as competition from other stores like Target Corporation (NYSE: TGT) and The Kroger Co (NYSE: KR) rises.

Unique Shopping Experiences

In order to get customers through the door, Wal-Mart is also trying to improve by offering customers a better in-store experience.

The firm is working to roll out exclusive products that can only be found in Wal-Mart and improve its produce section by hiring employees whose sole responsibility will be taking care of the fresh-food section. The company is also working to develop an online grocery service that allows customers to do their shopping at home and have their orders delivered to them in the parking lot.

Will It Be Enough?

In many ways, Wal-Mart's decision to invest in its future at a time when other companies are pulling back is a good sign as it demonstrates the firm's commitment to long-term growth. However, it remains to be seen whether or not the discount retailer's overhaul will be enough to give the store a boost in the coming years.

Posted-In: News Markets Best of Benzinga


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