Analyze Walmart and Amazon.com using the competitive forces and value chain models.
Walmart an Amazon are the biggest retailers in their segment; Walmart as physical retailer and Amazon as an online retailer. Now they are starting to compete more and more against each other due to a change of their customer base. Walmarts customers becoming more and more technically knowledgeable and feel more and more comfortable by using a phone to order a product online. These two companies are so big that it is hard for other companies entering the market. Walmart is having the price strategy with everyday low prices. To make a profit Walmart has to sell large quantities of a product. On the other hand Amazon does not have to calculate the cost of employees …show more content…
Also these two companies are competing against each other. This displays that there are substitutes for both companies. Usually there is for every successful product a substitute product. Currently Walmart is fighting against Amazon because this could be the future and Amazon might be able to replace Walmart totally.
Seven years ago only ¼ of Walmart customer base shopped at Amazon compared to now a day this number increased to 50%. That displays that the customers from Walmart getting more familiar with shopping online, but still go to physical stores. For both companies it is important to maintain and increase their customer base and Amazon was in the last years highly more successful than Walmart. Never the less 2/3 of the US population are living within a 5-mile radius from a Walmart store.
The suppliers are playing a big role in both companies offers and profits. These two companies are so dominant in their area that both can pick their suppliers however they want. They are also able to dictate the prices the want to buy and sell a product for. If a supplier does not agree they will miss out on the chance to get seen and purchased by a large quantity of …show more content…
The difference is that Walmart started as physical retailer and Amazon started as an online retailer. Walmart is having the price strategy that guarantees every day low prices. With almost no employee cost compared to Walmart, Amazon is able to offer its products for a very low price too. For most orders over 30 dollars Amazon is offering free shipping. Also Amazon offers a prescription for 99 dollars that includes free two day shipping. Walmart reacted to the trend that more and more customers becoming familiar with online shopping and acquired tech companies to be able to compete with Amazon in the online retail
Walmart an Amazon are the biggest retailers in their segment; Walmart as physical retailer and Amazon as an online retailer. Now they are starting to compete more and more against each other due to a change of their customer base. Walmarts customers becoming more and more technically knowledgeable and feel more and more comfortable by using a phone to order a product online. These two companies are so big that it is hard for other companies entering the market. Walmart is having the price strategy with everyday low prices. To make a profit Walmart has to sell large quantities of a product. On the other hand Amazon does not have to calculate the cost of employees …show more content…
Also these two companies are competing against each other. This displays that there are substitutes for both companies. Usually there is for every successful product a substitute product. Currently Walmart is fighting against Amazon because this could be the future and Amazon might be able to replace Walmart totally.
Seven years ago only ¼ of Walmart customer base shopped at Amazon compared to now a day this number increased to 50%. That displays that the customers from Walmart getting more familiar with shopping online, but still go to physical stores. For both companies it is important to maintain and increase their customer base and Amazon was in the last years highly more successful than Walmart. Never the less 2/3 of the US population are living within a 5-mile radius from a Walmart store.
The suppliers are playing a big role in both companies offers and profits. These two companies are so dominant in their area that both can pick their suppliers however they want. They are also able to dictate the prices the want to buy and sell a product for. If a supplier does not agree they will miss out on the chance to get seen and purchased by a large quantity of …show more content…
The difference is that Walmart started as physical retailer and Amazon started as an online retailer. Walmart is having the price strategy that guarantees every day low prices. With almost no employee cost compared to Walmart, Amazon is able to offer its products for a very low price too. For most orders over 30 dollars Amazon is offering free shipping. Also Amazon offers a prescription for 99 dollars that includes free two day shipping. Walmart reacted to the trend that more and more customers becoming familiar with online shopping and acquired tech companies to be able to compete with Amazon in the online retail