The Evolution of Walmart’s Marketplace Strategy

Walmart’s marketplace has been a key component of its e-commerce growth strategy, with sales from the marketplace jumping 32% in the quarter ending July 26, 2024, compared to the previous year. This marks the fourth consecutive quarter where marketplace sales have grown by more than 30%, a testament to the retailer’s success in attracting third-party sellers and expanding its online offerings.

The new logistics services, part of Walmart Fulfillment Services (WFS), represent a natural evolution of this strategy. By opening its logistics network to sellers beyond its own platform, Walmart is not only expanding the range of products available on its website but also offering a new revenue stream by leveraging its logistics infrastructure. Manish Joneja, Senior Vice President of U.S. Marketplace and Walmart Fulfillment Services, highlighted the importance of this move, stating, “If I’m a seller, I want to focus on my product. I want to focus on my customer. I need help with logistics, supply chain, different elements.”

Competing with Amazon on a New Front

Walmart’s decision to open its logistics services to third-party sellers mirrors the approach Amazon has taken with its Fulfillment by Amazon (FBA) service. Amazon has long been a dominant player in the e-commerce logistics space, with more than 60% of sales on its platform coming from outside sellers who rely on Amazon’s logistics network to handle warehousing, shipping, and returns.

By offering similar services, Walmart is directly challenging Amazon’s dominance in this area. However, Walmart is also bringing its own unique strengths to the table. “We have ample space available,” Joneja noted, referring to Walmart’s expansive warehouse network that has been built out and automated in recent years. This infrastructure, combined with Walmart’s experience in managing a vast supply chain, positions the company to offer competitive rates and reliable service.

Walmart’s new multichannel logistics program is designed to be cost-effective, with shipping rates that the company claims will be 15% lower than the competition. The service will also feature plain, unbranded packaging, ensuring that orders fulfilled through Walmart’s logistics network can seamlessly integrate with sellers’ operations on other platforms.

The Bigger Picture: Redefining E-Commerce Logistics

Walmart’s foray into third-party logistics represents more than just a new service offering; it signals a broader shift in the e-commerce landscape. As Lisa Ellram, a supply-chain professor at Miami University in Oxford, Ohio, pointed out, “The unutilized capacity that they have is a waste. Anything that they can cover of capacity that they’re not using is a benefit.” By monetizing its logistics capabilities, Walmart is not only generating new revenue streams but also optimizing the use of its resources.

This move could have far-reaching implications for the logistics industry as a whole. As Walmart continues to build out its logistics services, it may become a serious contender in the third-party logistics (3PL) space, challenging established players and potentially reshaping the competitive landscape. Adrian Gonzalez, President of Adelante SCM, commented on the broader implications of Walmart’s strategy, noting, “A lot of the initial commentary I’m reading is about how this levels the playing field with Amazon or perhaps ups the ante for them. But for me, the more interesting questions are: What is a 3PL today? What business are they in?”

Challenges and Opportunities Ahead

While Walmart’s new logistics services offer significant potential, there are also challenges that the company will need to navigate. The complexity of managing multichannel logistics, particularly during peak periods like the holiday season, requires robust systems and processes. Walmart’s initial offering will include two shipping options—expedited (two business days) and standard (three to five business days)—but these speeds are not guaranteed during peak times or sales events.

Moreover, products must meet existing Walmart Fulfillment Services requirements, and certain items, such as multi-box orders, will not be eligible at launch. These limitations, while not insurmountable, highlight the operational complexities involved in expanding logistics services to third-party platforms.

Despite these challenges, Walmart is well-positioned to capitalize on the growing demand for flexible, cost-effective logistics solutions. By offering services that cater to the needs of sellers across multiple platforms, Walmart is not only enhancing its own marketplace but also establishing itself as a key player in the broader e-commerce ecosystem.

A New Era in E-Commerce Logistics

Walmart’s decision to compete directly with Amazon on logistics is a bold move that reflects the retailer’s broader ambitions in the e-commerce space. By opening its logistics network to third-party sellers, Walmart is leveraging its strengths to offer a compelling alternative to Amazon’s FBA service. As the retail landscape continues to evolve, this move could redefine the logistics industry and further blur the lines between traditional retailers and e-commerce giants.

As the rollout of Walmart’s new services begins on September 10, all eyes will be on how the company executes this ambitious strategy. If successful, Walmart could not only solidify its position as a leader in e-commerce but also set the stage for a new era in logistics, where retailers are no longer just sellers of goods but also providers of end-to-end fulfillment solutions.

Driving Growth Through Omnichannel Excellence

Walmart’s omnichannel strategy is more than just a buzzword; it’s the backbone of the company’s approach to meeting the evolving needs of its customers. As consumers increasingly demand flexibility and convenience, Walmart is doubling down on its efforts to integrate in-store and online shopping experiences seamlessly. This approach has allowed the retail giant to capture a broader audience, from tech-savvy millennials to traditional shoppers who still value the in-store experience.

“We’re not just responding to trends; we’re shaping them,” said Doug McMillon, CEO of Walmart. “By offering our customers multiple ways to shop—whether it’s in-store, online, or through our app—we’re creating a shopping experience that’s tailored to individual preferences. This not only drives sales but builds deeper customer loyalty.”

Leveraging Stores as Fulfillment Centers

One of the key drivers of Walmart’s omnichannel success is its ability to leverage physical stores as fulfillment centers. With thousands of stores strategically located across the country, Walmart can offer faster delivery and pickup options, a critical advantage in today’s retail landscape. “Our proximity to customers gives us a unique edge,” explained John David Rainey, CFO of Walmart. “We’re able to fulfill online orders quickly and efficiently from our stores, which not only improves delivery times but also enhances the overall customer experience.”

Moreover, Walmart’s investment in technology has been pivotal in enhancing its omnichannel capabilities. The integration of GenAI-powered tools and AI-driven analytics allows the company to offer personalized shopping experiences, ensuring that customers find exactly what they need, when they need it. “Our goal is to make shopping as intuitive and seamless as possible,” said Tom Ward, Chief eCommerce Officer for Walmart U.S. “By harnessing the power of AI, we can better understand our customers’ needs and preferences, offering them a tailored experience that sets us apart from the competition.”

Significant Growth of Walmart+

Walmart’s success in omnichannel retailing is also reflected in its ability to attract and retain customers across various income levels. The retailer has seen significant growth in its Walmart+ membership, particularly among higher-income households, who value the convenience of delivery services and the broad assortment of products available online. “We’re seeing strong engagement across all demographics,” added Rainey. “Our ability to meet customers where they are—whether they prefer shopping in-store, online, or a mix of both—is driving our growth and solidifying our leadership in the market.”

As Walmart continues to innovate and expand its omnichannel offerings, it remains focused on providing value at every touchpoint. Whether it’s through faster delivery, enhanced in-store experiences, or personalized online shopping, Walmart’s commitment to omnichannel excellence is clear—and it’s paying off. “Our strategy is simple: make shopping easier, faster, and more enjoyable for our customers,” McMillon emphasized. “And as we continue to evolve, we’re confident that our omnichannel approach will keep us ahead of the curve in the retail industry.”

Innovation in Action: From Drone Delivery to AI Shopping Assistants

Walmart’s commitment to innovation is evident in its continuous efforts to integrate cutting-edge technology into its operations. From drone delivery services to AI-driven shopping assistants, the retail giant is redefining convenience and setting new standards for customer service.

Drone delivery, once considered a futuristic concept, has become a reality for Walmart customers. Since the company began trialing drone delivery in 2021, the service has rapidly expanded, with over 30,000 successful deliveries to date. “Our customers love the speed and convenience that drone delivery offers,” said Tom Ward, Chief eCommerce Officer for Walmart U.S. “It’s a game-changer, especially in situations where time is of the essence. We’re thrilled to be at the forefront of this technology, and we’re continually exploring ways to expand and improve the service.”

Walmart’s drone delivery system is designed to integrate seamlessly with the Walmart app, enhancing the overall shopping experience. Customers in select areas, such as Dallas-Fort Worth, are already benefiting from this integration, allowing them to order items via drone delivery directly through the app. “The feedback from our customers has been overwhelmingly positive,” Ward continued. “They appreciate the flexibility and the ability to get what they need in a matter of minutes, whether it’s last-minute snacks or essential household items.”

Leveraging Artificial Intelligence

Beyond drone delivery, Walmart is leveraging artificial intelligence to create a more personalized and efficient shopping experience. The company’s GenAI-powered shopping assistant, currently in beta testing, represents the next evolution of customer engagement. This AI assistant engages customers in natural, conversational interactions, helping them find the perfect product based on their specific needs. “We want shopping to be as intuitive as having a conversation with a knowledgeable friend,” explained Ward. “Our GenAI assistant can recommend products, answer questions, and guide customers through their shopping journey, making it easier than ever to find exactly what they’re looking for.”

The AI shopping assistant goes beyond simple product recommendations. It uses advanced algorithms to understand customer preferences, making suggestions that are tailored to individual tastes and needs. For instance, if a customer is shopping for a gift, the assistant can offer ideas based on the recipient’s age, interests, and previous purchases. “Our goal is to provide a truly personalized experience,” said Doug McMillon, CEO of Walmart. “We’re not just helping customers find products; we’re helping them find the right products, faster and with greater confidence.”

Walmart’s integration of these innovative technologies demonstrates its commitment to staying ahead in a rapidly evolving retail landscape. By embracing drone delivery and AI-powered shopping assistants, Walmart is not only enhancing the customer experience but also setting new benchmarks for the industry. “Innovation is at the heart of everything we do,” McMillon emphasized. “We’re constantly looking for ways to improve and elevate the shopping experience, and these technologies are just the beginning of what we have in store for our customers.”

Financial Performance: Strong Sales, Higher Profits, and a Positive Outlook

Walmart’s financial performance for the quarter reflects a robust and resilient business model, driven by strategic investments and a customer-centric approach. The retail giant reported strong sales growth, accompanied by even higher profit margins, signaling a positive outlook for the remainder of the fiscal year.

In the latest quarter, Walmart’s total net sales grew by 4.9% on a constant currency basis, surpassing expectations across all three operating segments. This growth was primarily fueled by a 4.2% increase in U.S. comparable sales, highlighting the company’s ability to attract and retain customers even in a challenging economic environment. “Our performance this quarter demonstrates the strength of our business model and our ability to adapt to changing market conditions,” said John David Rainey, Walmart’s Executive Vice President and Chief Financial Officer. “We’re seeing consistent sales momentum across our stores and digital channels, and our focus on delivering value is clearly resonating with customers.”

Ecommerce Growth is Key

One of the key drivers of Walmart’s financial success has been its e-commerce operations, which saw a remarkable 21% growth globally in the quarter. This was complemented by a significant uptick in store-fulfilled delivery, which increased by 50%. “Our omnichannel strategy is paying off,” Rainey noted. “By leveraging our extensive store network to fulfill online orders, we’re not only improving delivery times but also enhancing the overall customer experience. This approach is a win-win for both our customers and our bottom line.”

Walmart’s gross margin also expanded by 43 basis points, driven by a favorable business mix, cost management initiatives, and the strength of its private brand offerings. The company’s focus on efficiency and cost discipline has enabled it to maintain competitive pricing while also improving profitability. “We’re committed to everyday low prices, and we’re managing our costs effectively to ensure we can deliver on that promise,” Rainey said. “At the same time, we’re making strategic investments in areas like automation and technology that will drive long-term growth and profitability.”

Solid Foundation for Sustained Growth

Looking ahead, Walmart has raised its full-year sales and profit guidance, reflecting confidence in its ability to navigate the economic landscape and deliver continued growth. The company now expects net sales to increase by 3.75% to 4.75% for the full fiscal year, up from its previous estimate. Adjusted earnings per share are also projected to grow, with an expected increase of $2.35 to $2.43, up from earlier guidance. “We’re in a strong position to achieve our financial goals for the year,” Rainey emphasized. “Our diverse and durable business model, combined with our focus on innovation and customer satisfaction, gives us a solid foundation for sustained growth.”

Walmart’s positive financial outlook is further supported by its ability to gain market share across various categories, particularly in general merchandise and consumables. This is a testament to the company’s strategic initiatives and its ability to meet the evolving needs of consumers. “Our results this quarter are a clear indication that we’re on the right track,” said Doug McMillon, Walmart’s President and CEO. “We’re not just delivering strong financial performance; we’re also building for the future, ensuring that we continue to grow and create value for our customers, associates, and shareholders.”

Looking Ahead: Innovation and Expansion

As Walmart continues to solidify its position as a retail leader, the company is setting its sights on future innovations and global expansion to sustain its growth trajectory. The focus is not only on maintaining momentum but on strategically exploring new avenues that align with the evolving demands of customers and the broader market.

One of the key areas of focus for Walmart is expanding its capabilities in emerging technologies, particularly in artificial intelligence and automation. “We’re committed to leveraging the latest technologies to enhance our operations and improve the customer experience,” said Doug McMillon, Walmart’s President and CEO. “From AI-driven shopping assistants to advanced supply chain automation, these innovations are integral to our strategy for future growth.”

GenAI Shopping Assistance Are Just the Beginning

Walmart’s investment in technology is evident in its ongoing efforts to integrate AI into various aspects of its business. The introduction of GenAI-powered shopping assistants and enhanced search capabilities on Walmart.com and its mobile app are just the beginning. “AI allows us to offer more personalized and efficient services to our customers,” noted Tom Ward, Chief eCommerce Officer at Walmart U.S. “We’re not just reacting to trends; we’re setting new standards in retail with innovations that redefine convenience and customer satisfaction.”

In addition to technological advancements, Walmart is also eyeing further international expansion as a key growth driver. The company’s success in markets like Mexico, China, and India demonstrates the potential for growth beyond U.S. borders. “Our international operations are a critical component of our long-term strategy,” McMillon explained. “We’re seeing significant growth in these markets, and we’re committed to expanding our footprint and bringing Walmart’s value proposition to more customers around the world.”

Enhancing Omnichannel Offerings

Walmart’s approach to expansion is not just about entering new markets but also about deepening its presence in existing ones. The company is focused on enhancing its omnichannel offerings and building stronger connections with customers through localized strategies. “We’re not just exporting our U.S. model; we’re adapting and innovating to meet the unique needs of each market,” said Kath McLay, President and CEO of Walmart International. “Whether it’s through localized e-commerce platforms or tailored product assortments, we’re committed to delivering value in ways that resonate with customers globally.”

As Walmart looks to the future, its leadership is confident that the company’s blend of innovation, technology, and strategic expansion will continue to drive growth. “We’re building a business that’s not just resilient but also adaptable and forward-thinking,” McMillon concluded. “The investments we’re making today in technology, people, and global markets will ensure that Walmart remains a leader in retail for years to come.”

Redbox is one of the few ways to easily rent DVD movies, with the company’s kiosks a familiar sight outside of stores and fast food outlets. Unfortunately, despite their popularity, the future doesn’t look very good for the company.

According to The Associated Press, Chicken Soup for the Soul has filed for Chapter 11 bankruptcy, with documents showing that it owes some $970 million to more than 500 creditors. Creditors include major studios, such as Sony Pictures and Warner Bros, as well as retail outlets like Walmart and Walgreens.

As AP reports, Chicken Soup for the Soul says its creditors are unwilling to work with the company to refinance its debt. Of course, part of the creditors’ reluctance to work with the company could be a result of it defaulting on a settlement payment it owed to NBCUniversal. The two companies had agreed to a $16.7 settlement, but Chicken Soup for the Soul defaulted on the first $4 million installment.

Chicken Soup for the Soul bought Redbox in 2022, assuming its $325 million in debt. The fact that it’s debt is now closing in on $1 billion would seem to indicate that things have gone from bad to worse for the DVD rental company, or that it has been horribly mismanaged.

Leading companies like Walmart, Tyson Foods, and Maersk are already harnessing AI to gain a competitive edge. By leveraging advanced analytics and machine learning, these supply chain giants can predict demand fluctuations, optimize inventory levels, and identify alternative suppliers at lightning speed.

“It’s a game-changer,” says a future logistics expert. “AI is allowing these companies to be nimble and responsive in ways that were impossible just a few years ago.”

Take Walmart, for example. The retail behemoth uses computer vision technology to monitor product movement in its stores, enabling it to spot supply chain bottlenecks in real-time. When a product’s sales start to deviate from forecasted patterns, Walmart’s AI system can quickly flag the issue and recommend adjustments.

“There are no more bare shelves or excess inventory—AI is helping us get the right products to the right customers at the right time,” according to one expert’s theory.

But the AI revolution isn’t just benefiting the big players. Small and medium-sized businesses are also taking action, using AI-powered tools to optimize their operations and enhance customer service.

“I used to spend hours poring over spreadsheets, trying to figure out how much inventory to order,” says a hypothetical Sarah Johnson of the future, who owns a local hardware store. “Now, my AI assistant does all the heavy lifting, and I’ve cut my costs by 15% while improving my delivery times.”

Of course, the rise of AI in supply chains isn’t without its challenges. Experts warn that companies must invest in robust data infrastructure and upskill their workforce to capitalize on these technologies fully. And there are valid concerns about the impact on jobs, with some predicting that AI could automate away specific roles in the logistics industry.

Overall, the consensus is clear: AI is poised to revolutionize the supply chain, making it more efficient, responsive, and resilient than ever before. So hold on to your hats, America—the robots are coming, and they’re here to help. Or at least we hope so!

Walmart has enjoyed being the top retailer and #1 on Fortune’s list for years, but Amazon is closing that gap and may soon take the top spot. According to The Wall Street Journal, Walmart’s sales last year came in at $648 billion, growing at a rate of 6%. Meanwhile, Amazon’s revenue came in at $575 billion, with a growth rate of 12%.

The numbers alone don’t tell the whole story, however, but still pose a major problem for Walmart. The vast majority of the company’s revenue comes directly from retail sales. In contrast, a large portion of Amazon’s revenue comes from its other businesses, such as cloud computing.

WSJ’s sources say this difference is a concern among Walmart executives, since the company’s opportunities to compete with Amazon outside of retail sales are limited. Instead, Walmart execs seem to be focusing on providing the best service and being the best corporate citizen, as opposed to being the biggest, in what may be an acknowledgment of the inevitable.

That narrative appears to already be making its way into the company’s official stance, with a company spokeswoman telling WSJ that Walmart is “constantly striving to be the best version of ourselves, staying true to our values and offering quality, affordable goods and services. Everything else will take care of itself.”

Walmart is trying to diversify its revenue sources. One such attempt involves the company teaming up with Salesforce to sell its fulfillment and delivery software and solutions to other companies. Despite such efforts, Walmart still can’t compare to Amazon’s extra-retail revenue.

As WSJ points out, the one stronghold Walmart still has is groceries, but Amazon is making headway even there, with the company projected to take 20% of the US grocery market by the end of the decade.

Walmart is working to streamline operations, shutting down its Walmart Health initiative and eliminating hundreds of corporate jobs. The company is also taking a page out of Amazon’s book, launching its Walmart+ subscription service to take on Amazon Prime.

Only time will tell if such measures—along with its diversification efforts—help the retail giant fend off Amazon

According to The Wall Street Journal, the retail giant’s workers in Atlanta, Dallas, and Toronto have been asked to move to the company’s larger hubs and corporate offices. The outlet’s sources report that employees will be allowed to continue working remotely to some degree, as long as the majority of their time is spent in the office.

The move comes just weeks after Walmart announced it was shutting down Walmart Health, citing “a lack of profitability that make the care business unsustainable for us at this time.”

With ongoing concerns about the economy, Walmart is clearly trying to cut costs and streamline operations. It’s unclear if the corporate jobs that were axed were supportive roles for Walmart Health, or if they were unrelated.

The announcement marks a significant shift for the retailer, which has traditionally focused on its vast physical and e-commerce platforms. With the majority-owned fintech subsidiary, One, now offering installment loans, Walmart is expanding its financial offerings and setting the stage to disrupt the existing BNPL landscape dominated by players like Affirm and Afterpay.

A report on CNBC discusses Walmart’s entrance into the Buy Now, Pay Later Arena:

Strategic Expansion Beyond Retail

“Walmart is not just a retail giant anymore; it’s moving into high-margin businesses,” CNBC.com’s Melissa Repko explained during a discussion. The retailer is adopting a strategy similar to Amazon’s by focusing on its core retail operations and exploring more profitable sectors such as advertising and financial services. The introduction of installment loans through its fintech arm signifies Walmart’s intent to tap into the lucrative financial industry, offering consumers new ways to finance their purchases directly through Walmart, which could enhance customer loyalty and increase sales.

This shift towards financial services underscores Walmart’s intention to maximize profits and reduce reliance on low-margin retail sales. By creating its BNPL service, Walmart aims to retain more control over its financial ecosystem, potentially offering more competitive rates and terms than external providers. This could improve profit margins and attract a new demographic of consumers looking for flexible payment solutions.

Impact on Existing Partnerships

The new initiative by Walmart’s fintech One is raising concerns among its current partners. “With Walmart building out its technology to support BNPL loans, partners like Affirm might soon find their relationship with the retailer in jeopardy,” added CNBC’s Hugh Son. As Walmart moves to integrate these services in-house, it might reduce its reliance on third-party financial technology providers, which could reshape current business alliances and affect the competitive dynamics within the BNPL space.

Particularly troubling for existing partners like Affirm is Walmart’s potential to fully replace its services with its solutions. If Walmart’s in-house BNPL offerings gain traction, it could significantly reduce its partnerships with specialized fintech firms, which rely heavily on the volume generated by such large retail clients. This strategic shift could force these companies to rethink their business models as Walmart aims to consolidate more of its financial operations internally.

Future of Walmart’s Fintech Ventures

Speculation is growing about the potential future expansions of Walmart’s fintech capabilities. Analysts are curious whether One will evolve to offer branded credit cards, further enhancing Walmart’s financial service offerings. “It’s too soon to tell,” remarked a CNBC analyst during the interview, highlighting the cautious approach Walmart is taking in unveiling its complete fintech strategy. However, the potential for One to encompass features such as credit issuance is significant, considering Walmart’s vast retail network and customer base.

Integrating these financial services within Walmart’s ecosystem could be a game-changer for the retailer and its customers. By offering a seamless financial experience under the Walmart umbrella, One could enhance customer retention and increase average spend per visit. This strategic move aligns with Walmart’s long-term vision to remain a dominant player in the retail sector and establish a significant foothold in the financial services industry.

Walmart’s History and Strategy in Financial Services

Walmart’s foray into financial services is not new; the company has been attempting to penetrate this sector since the 1990s. Despite facing regulatory hurdles and opposition from banking lobbyists, Walmart has persisted in its efforts to integrate financial services into its offerings. This persistence reflects the retailer’s understanding of the financial sector’s potential profitability and its desire to diversify its revenue streams beyond the low-margin retail industry.

Historically, Walmart’s attempts to establish a banking division have been thwarted by regulatory challenges. However, the landscape appears to be changing as Walmart employs innovative strategies to circumvent these barriers. By partnering with Ribbit Capital, a renowned fintech VC firm known for its investments in Affirm and Robinhood, Walmart is well-positioned to overcome previous obstacles. This partnership underlines Walmart’s commitment to enter the financial services market and innovate within it.

Regenerative agriculture involves improving soil health and water quality, as well as protecting the environment by reducing greenhouse gas emissions. The companies tout the impressive gains that can come from regenerative agriculture:

PepsiCo and Walmart today announced a 7-year collaboration to pursue $120 million worth of investments focused on supporting U.S. and Canadian farmers in their pursuit to improve soil health and water quality. By establishing and scaling financial, agronomic and social programs, it aims to enable and accelerate the adoption of regenerative agriculture practices on more than 2 million acres of farmland and deliver approximately 4 million metric tons of greenhouse gas (GHG) emission reductions and removals by 2030 – roughly equivalent to the amount of electricity needed to power 778,300 homes for one year.

Rather than a one-size-fits-all endeavor, the two companies are taking a pragmatic approach, with the program being voluntary and offering farmers flexible options.

“Successful sustainability starts and ends with trust. At PepsiCo, we work very hard to earn the trust of the farmer so they understand that we are investing in their legacy, and they can hand their farm down to the next generation,” said Jim Andrew, Chief Sustainability Officer, PepsiCo. “Farmers know their business better than anyone else, and what we hear from them is that for regenerative agriculture to make business sense, three things need to happen. They need economic support, social and cultural support, and agronomic support. This strategic collaboration with Walmart will advance our shared goal to have farmers’ backs as they transform farming in a way that benefits the planet and people.”

“At Walmart, our sustainability strategy is built to make the everyday choice the sustainable choice for our customers,” said Jane Ewing, Senior Vice President for sustainability at Walmart. “This collaboration with PepsiCo is a great example of how we are prioritizing the expansion of regenerative agricultural practices among farmers across North America so that we can continue to make quality products affordable and accessible for customers. This collaboration aims to help elevate farmer livelihoods, engage them on how to more sustainably manage soil health, increase yields and create a model that others can mimic across other product categories, including encouraging additional investments in regenerative agriculture by other brands.”

Simon served as President and CEO of Walmart U.S. from 2010 to 2014, giving him a unique perspective on the retail industry. Rather than predicting doom-and-gloom for traditional retail, Simon believe technology has the ability to transform the industry and open all new possibilities.

Even something as simple as trying on clothes may be revolutionized by technology, such as virtual reality.

“Could we have virtual changing rooms so that you can just scan an item in a store with your phone and try it on yourself without actually having to go try it on?” Simon said on CNBC’s “Squawk on the Street.”

Simon believes successful retailers will combine online sales with a brick-and-mortar presence, and cites Target and Amazon as two examples of companies that are making it work.

Walmart revolutionized the retail market thanks to its focus on logistics, fulfillment, and delivery. The retail giant is looking to make money off of its innovative solutions by selling fulfillment and delivery solutions to other retailers and teaming up with Salesforce to make it happen.

“Through this partnership, retailers can leverage the same innovative and scalable technologies that power Walmart’s pickup and delivery experiences,” said Anshu Bhardwaj, senior vice president, technology strategy and commercialization, Walmart Global Technology. “The same technology that powers Store Assist has enabled Walmart to fulfill over 830 million orders across over 4,700 Walmart stores. Together with Salesforce, retailers can scale their business and deliver the personalized, convenient experiences shoppers expect.”

“Salesforce is thrilled to partner with Walmart as it transforms its business and further expands into the digital technology market,” said Tyler Prince, Executive Vice President, Alliances & Channels, Salesforce. “Through this partnership with Salesforce, Walmart can grow its business in new ways by productizing its proven retail processes – empowering other retailers to create new and personalized experiences for their customers.” 

Walmart says retailers will be able to take advantage of three major features, including Buy Online and Pick Up In-Store (BOPIS), use Walmart GoLocal to manage local deliveries, and take advantage of Salesforce Commerce Cloud and Order Management to manage the entire omnichannel shopping experience.

“Shoppers continue to expect brands to deliver highly connected and frictionless experiences across physical and digital touchpoints. In fact, 1 in 5 online orders placed the weekend before Christmas were picked up in store,” said Rob Garf, vice president and general manager of retail, Salesforce. “With the combined power of Walmart and Salesforce, retailers can drive success with best-in-class technology to advance their omnichannel capabilities, drive efficiency and ensure that every purchase quickly gets into the hands of the shopper – no matter where they are.”

“We can’t wait for customers to use Walmart+ as a way to keep more time on their calendars and money in their pockets,” said Janey Whiteside, chief customer officer, Walmart. “We designed Walmart+ to be the ultimate life hack for customers, pulling together benefits they told us would be most helpful to them today and in the future. Its usefulness will only grow from here.”

The initial list of Walmart+ benefits is below. The company says that the list of benefits will continue to grow over time:

• Unlimited free delivery: In-store prices as fast as same-day on more than 160,000 items from fresh produce, to milk, eggs and bread to tech and toys to household essentials. This service was previously known as Delivery Unlimited – a subscription service that allows customers to place an unlimited number of grocery deliveries for a low, flat yearly or monthly fee. Current subscribers will automatically become Walmart+ members.
• Scan & Go: Unlock Scan & Go in the Walmart app – a fast way to shop in-store. Using the Walmart app, customers can scan their items as they shop and pay using Walmart Pay for a quick, easy, touch-free payment experience.
• Fuel discounts: Fill up and save up to 5 cents a gallon at nearly 2,000 Walmart, Murphy USA and Murphy Express fuel stations. Sam’s Club fuel stations will soon be added to this lineup.

Bill Simon, former CEO of Walmart, discusses the launch of Walmart+ designed to take on Amazon by combining free delivery of groceries and general merchandise within a paid subscription service:

Walmart+ Goes Head To Head With Amazon

Walmart has long coveted a subscription service to go head to head with Amazon. They tried three or four times but this one is different. Walmart+ combines both their grocery and their general merchandise strength which is really trying to recreate the supercenter online through a subscription service. If they can use the frequency of their food business to also help sell their general merchandise line they can mix it out better and hopefully get to profitability sooner.

Retail has actually been better (this last quarter) than most people have expected. It’s not been even. There have been categories and retailers who have struggled. By and large, its help up pretty well. The pandemic accelerated digital ecommerce development by five to ten years. If you were not up to speed on that or didn’t get up to speed very quickly you would be behind. As we head into the fall it will be really interesting to see how it goes.

Holiday Selling Season Uncertain

Typically, Black Friday and Cyber Monday, that weekend has been really critical to the selling season. If you missed that it would be very difficult to have a really good holiday selling season. With the delayed openings now and Thanksgiving not on the line, the focus is going to be online and there won’t be as many in-person Black Friday deals. It’s going to be difficult for retailers to make up all that volume online. The holiday selling season is going to be a bit uncertain.

I’m really speaking from the consumer perspective when I say that digital ecommerce accelerated by five to ten years in the last six months. It accelerated at that pace and people had to head in that direction. That is likely where retail is going to head but it is going to still be a mix. The vast majority of retail will remain brick and mortar but ecommerce will take a larger role in the facilitation by online pickup in store. Customers are now completely blending the omnichannel retail experience.

The Amazon Effect: Digital Sales Rule!

There’s also been really a change from an investment standpoint. This has been really more the Amazon effect than anything I can think of. Five years ago, it used to be, grow your profit faster than your sales and your share price would move forward. Now, if you’re not growing digital sales at a hyperactive rate it’s really hard to get a good valuation on your company. Walmart is a great example of a retailer employing this strategy.

They’ve invested a ton of money, almost a third of their operating income they’ve given up in order to build an ecommerce business. Yet, investors have rewarded them by buying their stock. It’s near historic highs.

AI is the new darling of the tech industry, with OpenAI, Microsoft, and Google leading the way. Walmart may not be the first company that springs to mind in the context of AI, but Bloomberg is reporting that the retailer is using it for vendor negotiations. The company has tapped Pactum AI, using its chatbot for the process.

“We set the requirements and then, at the end, it tells us the outcome,” says Darren Carithers, Walmart’s senior vice president for international operations.

Carithers went on to tell Bloomberg that the AI has reduced negotiation times from weeks or months to mere days. What’s more, the bot has saved an average of 3% on contracts, with a 68% success rate in reaching deals.

Perhaps most surprisingly, three-quarters of the company’s suppliers prefer negotiating with the AI.

“Some really like it and are like, ‘This is the best way to do it,’” Carithers continued. “But I would relate that to people using self-checkout in stores. Some customers love it, but guess what: Some customers want to go to a manned checkout and see a person.”

The AI is currently only being used to negotiate contracts for equipment the company uses, such as shopping carts, and not goods being sold on shelves. Given the success Walmart is experiencing, however, it’s likely only a matter of time before AI negotiators are tasked with more responsibility.

Burt Flickinger, Managing Director of SRG, a consumer industry business consulting firm, discussed how Walmart is winning the retail wars in an interview on Fox Business:

Walmart is the Roman Empire of Retail

This earnings report just reinforces its winning. Amazon is going sideways. This is a reenactment of the Punic Wars, Rome versus Carthage. Walmart is the Roman empire of retail. Like Hannibal and the Carthaginians, Amazon is starting to go the wrong way. Big win for Walmart today and they will accelerate that in the next two to seven years.

What’s doubly impressive, we talk to a lot of vendors and shoppers around the world, what the vendors are saying is Walmart is reinvesting all the PPA (price and promotional allowances) in lower prices. Lower prices normally mean lower margins and lower revenue. But in this case, the shopper is shifting to Walmart.

Walmart strategically saw all the land-based businesses like Payless and all the retailers from toys to sporting goods going out of business. They had great sales on land and not so good online. Walmart is winning both ways. Amazon, with all the trouble they’re having with Whole Foods, can’t capitalize. Walmart is running the table.

This Says it All for US Retail

This says it all for US retail. The well capitalized highly capable retailers are winning and if it’s a one man show, like Bezos running the show, you could be Alexander the Great, you could be Hannibal out of Carthage, but one general isn’t going to win a war. Recent (lower) retail sales numbers were a combination of a couple things. One is Jerome Powell scared the market, especially high to mid-end, didn’t spend as much. Also, consumers were a little bit scared toward the end of the year. Walmart, off price, low price, did very well, but full price full service struggled and that’s why the numbers were bad.

Walmart comp sales increased 4.2 percent, just like Steve Jobs and Apple with their great campaign Think Different with Muhammad Ali, Walmart is thinking different with Doug McMillon. It’s evolved from a company of family management to professional management. Walmart had 40 percent growth online.

Walmart Ads Are Really Connecting

Before, Walmart looked at advertising as an expense. But as Jerry Della Femina said, most of the Super Bowl ads were pretty pathetic. Walmart was one that stood out because it advertised Walmart online and Walmart in-store. The Walmart ads are really connecting with consumers, a United Nations of consumers.

They’re reaching everybody around the world with better prices and better service. Doug McMillon has invested in inventory and has invested in store staffing, first to raise wages with some push from the UFCW. They are hitting on all cylinders. The biggest problem now is they can’t handle all of the volume they are seeing on the weekends.

Companies continue to develop AI at an astonishing pace, with it being used in everything from chatbots to workplace automation. The latter is particularly concerning to many workers who fear AI will eventually take their jobs.

McMillon says that’s not the case, despite Walmart increasingly relying on automation.

“We see the opportunity to accelerate that progress with investments in supply chain automation which includes data, software, and robotics,” McMillon said at an investor event. “We’ll improve item location accuracy, in-stock levels, unit economic costs, and delivery speed. The combination of sales growth, productivity improvements, and business mix changes will enable us to grow profitability faster than sales.”

“A key part of the strategy is automation, like you saw yesterday,” added John Furner, President and CEO, Walmart US. “If you ask “Why automate?” The answer is it helps our customers and our associates and our business. Automation helps our customers with better accuracy, availability, and speed.

“Automation helps our associates. It results in less manual labor. Over time, we believe we’ll have the same or more associates and a larger business overall. There will be new roles emerging that are less manual, better designed to serve customers, and pay more.”

The news will likely reassure employees about their job security and future roles within the company.

As CNN reports, Walmart doubled down on its commitment to its Chicago stores in the aftermath of George Floyd’s murder. The commitment was part of the company’s broader efforts to support racial equality. Just a couple of years later, and the company is confronting the economic realities of the decision, concluding it is no longer sustainable.

“The simplest explanation is that collectively our Chicago stores have not been profitable since we opened the first one nearly 17 years ago – these stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years,” the company wrote in a blog post. “The remaining four Chicago stores continue to face the same business difficulties, but we think this decision gives us the best chance to help keep them open and serving the community.”

“Over the years, we have tried many different strategies to improve the business performance of these locations, including building smaller stores, localizing product assortment and offering services beyond traditional retail. We have invested hundreds of millions of dollars in the city, including $70 million in the last couple years to upgrade our stores and build two new Walmart Health facilities and a Walmart Academy training center.”

The closures are a stunning turnaround after years of Walmart and local politicians working to help bring the big-box retailer to Chicago’s underserved communities.

The following stores are slated for closure by April 16:

• #5781 Chatham Supercenter, the Walmart Health center, and the Walmart Academy, 8431 S. Stewart Ave.
• #3166 Kenwood Neighborhood Market, 4720 S. Cottage Grove Ave.
• #5645 Lakeview Neighborhood Market, 2844 N. Broadway St.
• #5646 Little Village Neighborhood Market, 2551 W. Cermak Road

The company says the pharmacies at those locations will continue serving customers for up to 30 days.

For many tech workers, working for the likes of Microsoft, Meta, Google, and Amazon was a dream come true…until the dream came crashing down. As they move on to new opportunities, The Wall Street Journal is reporting that many of those who have been laid off are choosing jobs that emphasize stability over status.

“The majority of folks that have been laid off from big tech companies, they’ve been disillusioned,” said Chris Rice, a partner with Riviera Partners, an executive-search firm.

That disillusionment has given employees new opportunities with other companies, companies that offer them a sense of purpose they didn’t always have at their Big Tech jobs.

“As an engineer, I derive value from doing something useful,” said John Kew, an engineer who worked at Tableau Software. “In particular at a large company, it’s hard to feel that way.”

Smaller companies are benefiting as well, gaining access to a talent pool that would otherwise have been unavailable, snatched up by much larger companies.

“There’s a gold rush to capitalize on those opportunities and be at the forefront,” said Julia Pollak, chief economist with ZipRecruiter.

“They couldn’t compete with tech companies on comp packages for tech employees because they didn’t have the same stock value. That was a huge problem for them,” she added. “Now they’re like, ‘This is wonderful, we can actually hire again.’”

Companies outside the tech industry are similarly benefiting.

“We’re likely looking a little brighter these days than we might have before,” said Donna Morris, chief people officer at Walmart.

“Now, we’re seeing that they’re coming to us,” said Melissa Werneck, Kraft’s global chief people officer, of technology employees. “We’re seeing them knocking more on our doors.”

One thing is clear: The tech industry’s layoffs are having far-reaching consequences and will likely continue reshaping the job market for months and years to come.

Walmart currently partners with Volkswagen’s Electrify America to provide charging stations at its stores. As EVs gain in popularity, the retail giant is looking to deploy its own chargers, giving it more control over pricing and availability.

Vishal Kapadia, Senior Vice President, Energy Transformation, outlined the company’s plans:

With a store or club located within 10 miles of approximately 90% of Americans, we are uniquely positioned to deliver a convenient charging option that will help make EV ownership possible whether people live in rural, suburban or urban areas. Our goal is to meet the needs of customers and members where they live and open the road to those driving across the country. Easy access to on-the-go charging is a game-changer for drivers who have been hesitant to purchase an EV for concerns they won’t be able to find a charger in a clean, bright and safe location when needed.

What’s more, with our chargers located on site with our Supercenters, Neighborhood Markets and Sam’s Clubs, we can offer customers and members the convenience of being able to pick up essentials for their families or grab a bite to eat while they charge. And in line with our purpose, we aim to offer Every Day Low Price charging – helping ease transportation costs, still the second highest household cost for much of our country.

The company plans to deploy the new network by 2030, complementing the 1,300 charging stations it already has via its partnership with Electrify America.

Walmart revolutionized the retail market thanks to its focus on logistics, fulfillment, and delivery. The retail giant is looking to make money off of its innovative solutions by selling fulfillment and delivery solutions to other retailers and teaming up with Salesforce to make it happen.

“Through this partnership, retailers can leverage the same innovative and scalable technologies that power Walmart’s pickup and delivery experiences,” said Anshu Bhardwaj, senior vice president, technology strategy and commercialization, Walmart Global Technology. “The same technology that powers Store Assist has enabled Walmart to fulfill over 830 million orders across over 4,700 Walmart stores. Together with Salesforce, retailers can scale their business and deliver the personalized, convenient experiences shoppers expect.”

“Salesforce is thrilled to partner with Walmart as it transforms its business and further expands into the digital technology market,” said Tyler Prince, Executive Vice President, Alliances & Channels, Salesforce. “Through this partnership with Salesforce, Walmart can grow its business in new ways by productizing its proven retail processes – empowering other retailers to create new and personalized experiences for their customers.” 

Walmart says retailers will be able to take advantage of three major features, including Buy Online and Pick Up In-Store (BOPIS), use Walmart GoLocal to manage local deliveries, and take advantage of Salesforce Commerce Cloud and Order Management to manage the entire omnichannel shopping experience.

“Shoppers continue to expect brands to deliver highly connected and frictionless experiences across physical and digital touchpoints. In fact, 1 in 5 online orders placed the weekend before Christmas were picked up in store,” said Rob Garf, vice president and general manager of retail, Salesforce. “With the combined power of Walmart and Salesforce, retailers can drive success with best-in-class technology to advance their omnichannel capabilities, drive efficiency and ensure that every purchase quickly gets into the hands of the shopper – no matter where they are.”

According to KPTV, Walmart plans to close its remaining two Portland locations in late March.

“The decision to close these stores was made after a careful review of their overall performance. We consider many factors, including current and projected financial performance, location, population, customer needs, and the proximity of other nearby stores when making these difficult decisions. After we decide to move forward, our focus is on our associates and their transition, which is the case here,” a Walmart spokesperson said.

While the company officially blamed “financial performance,” Walmart has been struggling with record-breaking theft. Walmart CEO Doug McMillion warned months ago that the company’s financial performance was being negatively impacted as a result.

It’s unclear if crime was a factor in the company’s decision.

Walmart purchased Moosejaw in 2017 for $51 million as it was ramping up its online offerings. The purchase seemed like a good fit, given Moosejaw’s successful e-commerce presence.

Just a few years later, Walmart is now offloading the company, selling it to Dick’s — which is arguably an even better fit, given both companies’ focus on outdoor apparel and gear.

“We admire what Moosejaw has accomplished over the past 30 years as leaders in the outdoor industry and look forward to the opportunity to share insights and learn from one another,” said Todd Spaletto, President, Public Lands and Senior Vice President, DICK’S Sporting Goods. “We believe there’s potential to grow the Moosejaw business and provide compelling experiences and an expanded product assortment to its millions of loyal customers.”

The deal is expected to close March 2023. The financial terms of the deal were not disclosed.