Wal-Mart’s Need for E-commerce


In a recent Wall Street Journal article, “Wal-Mart’s E-Stumble”, Amazon was confirmed as the leader in online sales due to its large U.S. warehouse network, but Wal-Mart is trying to find ways to compete. Although Wal-Mart is not only building its warehouse network and looking at other opportunities to lower logistics and distribution costs, Amazon posted web sales of $61 billion, compared to an estimated $7.7 billion for Wal-Mart. It was stated by former Wal-Mart executives that Wal-Mart was late to the e-commerce game. By taking this “wait and see” approach into the e-commerce business, Wal-Mart lost valuable market share to its competitors that it has not been able to regain. As more consumers purchase items via the internet it will be even more necessary for management to be creative in finding new ways to pick-up customer business.

In an attempt to compete in e-commerce Wal-Mart will either ship from warehouses, have workers package products and send from individual store locations or even in certain store locations set up in-store lockers for e-commerce customers to pick-up items. Wal-Mart may be able to take advantage of same day delivery for grocery items that other companies started to try and promote. Currently the store isn’t set up for same day delivery of fruits and vegetables, but stores like Amazon have started to build there infrastructure for shipping same day perishable items. Recent acquisitions by Wal-Mart, including the company’s purchase of Chinese online retailer Yihaodian, have helped to increased this years fiscal global e-commerce earnings. I believe that it will take more of these acquisitions for in order to increase at the pace to pick up market share. This could be in the form of warehousing, logistics or even software.

I find it strange that a company as large as Wal-Mart has not been able to be more competitive in e-commerce and that management took a backseat early on in this quickly growing market. Not only in the U.S. but in markets like China you are seeing huge e-commerce business by companies such as Costco and Macy’s. These companies have found that this can be a way to limit risk and costs by not needing to have stores, but just have warehouses in low rent areas. Using the vast supply chains of these companies will continue to push them to increase their e-commerce sales.

Over the past few years I have used e-commerce for its convenience and ease of searching for products. In terms of groceries I still like to go to the store in-person to make my choices, but for pretty much anything else, I’ll shop via e-commerce. From the articles I’ve read and people I’ve spoke with it appears that this is the trend in the marketplace.

Do you think it’s necessary for Wal-Mart to increase its e-commerce market share in order to excel? Do you expect that the current ideas Wal-Mart has to increase e-commerce sales will work or are there other ideas that would work better for Wal-Mart’s business model?




Fast Fashion to Hit the U.S.


H&M Hennes & Mauritz AB is a Swedish retail clothing company that is known internationally for its affordable fashion for men, women, and children. With 2,776 stores in 48 markets, H&M has been ranked the second largest clothing retailer in the world. Though the clothing company has gained a reputation for being fashion forward, the same cannot be said about its ability to keep up with online shopping demand. H&M currently offers online shopping to customers in just eight of its 48 markets around the world: Sweden, Norway, Denmark, Finland, Germany, the Netherlands, Austria, and the United Kingdom, but none in the United States. This has U.S. customers scratching their heads in confusion and growing impatient. The retailer stirred up excitement back in January 2011 with a tweet that stated:

“Good morning is an understatement! H&M has decided to have online shopping in the U.S. at the turn of the year 2011/2012! Stay tuned for more.”

Unfortunately, two years have passed and H&M has failed to deliver on that promise. The retailer is still “not set up for mail order, phone orders or e-commerce at the present time”. However, there is still hope for U.S. customers. H&M’s 2013 Expansion Strategy revealed: “Investments will also continue within online sales. H&M plans to launch online sales in the US, the world’s largest market for e-commerce.” Business Week also reported that shopping from H&M’s website could happen as early as Summer 2013.

Entering the U.S. online retail market goes beyond satisfying millions of America’s fashion lovers. “The U.S. online retail market is the biggest in the world; research firm Forrester estimates it will reach about $260 billion this year. Taxes vary by state, shoppers expect free shipping, and returns are common”. The process is quite complex and H&M has cited “issues with security, customer service, logistics, and the assortment of items offered” as reasons for delay. But the longer the retailer waits, the more demanding customers become. Not only are U.S. customers looking for the ability to shop online, but they are also expecting the company to have smartphone applications available, too. H&M says they will meet this demand. For investors sake, H&M cannot disappoint  because the company’s competitors have already figured out how to engage their U.S. customers in online shopping.

With just a few weeks left till summer, anticipation for the launch of H&M’s online store will grow largely. Having only photo galleries of tasteful, trendy clothes and accessories will not be enough for die hard shoppers this year and if the project fails to launch, there could be dreadful consequences for the company. In ending, some important questions to consider are: Do you think H&M waited too long to enter the U.S. online market? Is this expansion strategy necessary in today’s retail industry? How do you think launching an online store will affect H&M’s competitors?  Finally, on a scale of 1-10, how important is online shopping for you? Does it affect the way you shop?



Business Week: http://www.businessweek.com/articles/2013-03-28/h-and-ms-online-troubles-u-dot-s-dot-shoppers-are-still-waiting

H&M Expansion Strategy: http://about.hm.com/AboutSection/en/About/Facts-About-HM/About-HM/Expansion-Strategy.html#cm-menu

Annual Report: http://about.hm.com/content/dam/hm/about/documents/en/Annual%20Report/Annual-Report-2012_en.pdf

The Perfect Bra Size: An Algorithm Away

If you wear bras and are tired of never finding the right fitting cup, then True & Co promises the solution for you. True & Co aims to relieve the stress of having your saleslady come in go with a tape measurer and the wrong cup size. Sometimes the trip for a new bra becomes an intruding nightmare. This e-commerce company has devised an algorithm that matches the right fit for their customers and a truly intimate way.


True & Co asks customer’s a 15 question quiz which range from cup and band size to how your favorite bra feels and looks. The customer is then invited to choose three different style bras and with the information gathered, it uses an algorithm to choose two additional bras to be sent to you. Michelle Lam, the entrepreneur behind this,states that they have 2,000 algorithms that defines each body types.  Once customer receives the bras they have no obligation to purchase any of the five bras and the company claims that women buy more of the bras chosen by the algorithm than their own choice. But all matches are currently existing brands and none are their own designs. The prices are from $45- $62 and shipping is free.


This company seems to have a user based view upon entering this online bra market. They are concerned with how well the bra is fitted and so its quality is measured by the overall bra fit. The correct fit is determined in an individual matter and its quality is measure by customer’s individual taste. They offer to match the correct size and style to satisfy its customers in a quick easy matter.


So even though they do not manufacture custom bras, with such information obtained from the women taking their questionaires, naturally they can expand later in producing and designing their own bras and panties. Therefore, then expanding their level of serviceabililty, personal aesthetics, features,  and performance dimensions of quality.


There are some skeptics who question the algorithm and considered it a bit “ridiculous”, stating that a bra must touched and tried on before taking it home. Also, one of the issues Linda Becker, Linda the Bra Lady store and online seller, finds with online fittings is that there are some individuals who are extremely hard to fit and can be very difficult to help them out over the phone. But even so, Linda says that only 10 percent of LindaTheBraLady.com are returned.


In the history of commerce, shoes were once seen as product that was unsuitable for customers to buy since shoes are also one of those products that must be “tried on”.  But with the success of Zappos we know it can be done. Victoria’s Secret and HerRoom.com are some of the older sellers of online lingerie which proven selling bras can be successful online. Let’s see how well the True & Co algorithms reach success with this Amazon-like approach.







Questions to think about:

-What is your opinion on the business?

-What do you suggest about their future?

-Do you think it will measure up to the success of Amazon or Zappos?

-What are the chances you’ll choose True & Co versus going straight to the site?