Whenever there are competing products and services, the customer often wins with lower prices, better service, and even free shipping. That is certainly the case in the battle between Amazon and Walmart. With Amazon’s purchase of Whole Foods, we can expect the consumer to benefit with their grocery purchases as well. The long term plan of course is to have Amazon drones deliver groceries to your door. Or for larger deliveries, Amazon’s self-driving delivery cars.
As Amazon targets Walmart’s grocery dominance, Walmart has been doing the same by ramping up its overall ecommerce push, having recently acquired apparel retailers Moosejaw and Modcloth. Last August, it paid $3 billion for consumer products retailer Jet.com. To compete with Amazon, Walmart has lowered its shipping prices to zero when you place an order for $25 or more, without the need for an annual prime subscription. Amazon followed suit and dropped its free shipping threshold to $25.
Amazon has been beating Walmart at it “everyday low-price guarantee”. Walmart responded by calling in the major consumer suppliers — from diapers to clothes to TVs — with an offer they couldn’t refuse: Either cut their wholesale prices by at least 15 percent off, or Walmart would limit their presence in stores and create its own branded products to compete with them. Amazon, never afraid to cut sales margins by increasing volume, has responded by selling even more CRaP, an inside Amazon acronym for “Can’t Realize a Profit” products.
We know this is good news for consumers, but how does it affect you? If Amazon […]