Rivalry-Walmart/Amazon/Target

Table 14 Comparison of the top retailers in the world in 2016

Walmart

M&A - Jet.com, Bonobos and ModCloth Jet.com

Jet.com, which founded in 2014, has a rapidly growth. They have about 3.6 million users, with a total of 12 million products from 1,600 merchants with annual sales of about $ 1 billion. In 2016, Walmart took over Jet.com. In future through Jet.com's accession, Wal-Mart will make up the lack of territory in the e-commerce part to challenge the position of Amazon, America's e-commerce leader.

Bonobos

Bonobos has a decade-long history. They have 35 offline stores nationwide and online store. In addition to high-quality products and shopping experiences, Bono-Persia has drawn on Wal-Mart with its outstanding online channel. In 2017, Walmart took over Bonobos.

ModCloth

ModCloth is a women's clothing website. In 2012, website sales exceeded 100 million US dollars. In 2017, Walmart took over ModCloth

1. Online orders and pick up at store

Customers can buy the goods on Walmart's website and choose the Walmart store and time to pick up the orders. Walmart also has "curbside service". As long as the consumer choose the pick-up time and Walmart's parking lot. And informs the store's staff, Wal-Mart will deliver the fresh food order to the customer's car. This service combines online shopping and physical storefront to extend the use of platform.

2. Walmart Pay

Walmart Pay is bound with the credit card payment is similar to the function of Apple pay. Walmart Pay also has another feature. Consumers can type in their shopping receipt number. The app will compare the price with other retailers. If the result of shows that other retailers have cheaper price, Wal-Mart will provide a gift card equivalent to the price difference.

3. Overall

Wal-Mart's strategy of opening up new markets is imperative. It has been looking for ways to enter the field of e-commerce. Fashion and young users are key words in Wal-Mart's strategy to enter the Internet.

Over the past two years in the field of fashion, Wal-Mart and Amazon have launched M&A. Wal-Mart in the past two years to 51 million NTD to acquisition of outdoor supplies retailer Moosejaw and70 million acquisition of footwear retailer ShoeBuy and other areas in the performance of excellent fashion brand.

Amazon

The following figure is Amazon growth rate is faster than U.S. e-commerce market.

Amazon through their low cost structure, 536 million of product selection and cooperation of third party sellers to become a largest e-commerce retailer in the world.

Figure 50 Amazon growth rate compared to e-commerce sales growth in U.S.

1. M&A whole food market

Whole food market has 460 stores in USA. The purchase of fresh food accounted for 30% of the total personal spending in the United States, but in all groceries online shopping behavior, fresh goods online shopping only accounted for a few percentage points. But Amazon loves to march into large markets because they can subvert tradition and innovates, and fresh areas are a suitable choice.

In 2017, Amazon acquisition of Whole Food market and make Amazon can combine with fresh food advantage and own the physical store to realize the one-stop shopping to satisfy the customer's needs.

2. Amazon fresh

Customer can select the product on Amazon, then drive to the parking spot at Amazon Fresh Pickup, where an employee will deliver your goods to put in customer's

car.

3. Amazon Prime

To be Amazon's membership have to pay $99 annual fee. And their member will have lots of benefits such as free shipping, free cloud storage service, free movie, music and E-book. In USA, there is 30% is membership of Amazon Prime andtheir member consume more than twice as many other consumers.The membership's renew rate is 80-90%. For e-commerce, the membership system screen out those people with high purchasing power or high purchasing potential, which will benefit the marketing afterwards and offer value-added services to make users more loyal.

Target

Target has 1828 stores in USA. Target has roughly $70 billion in sales are scattered nearly equally across its various businesses. In 2016, household essentials generated 22% of its sales; food generated (22%), apparel and accessories (20%), furnishings and decor (19%) and hardlines (17%).

Figure 51 Contribution to Comparable Sales Change

Target also makes an effort on developing digital channel to increase their sales and also compete with Walmart.

1. Online orders and pick up at store

Target also have a similar service to Walmart. Customers can buy the goods on website and choose the time and Target store to pick up their orders.

Target said that consumers place the orders on the website, when they go to store

to pick up their goods, one-third of consumers will buy other products on their physical stores. Therefore, in this way it can increase the sales on e-commerce and physical store at the same time.

2. Overall

Nowadays, the retail industry types are changed. Amazon subverts the traditional consuming behavior and also traditional retail industry types. They combine with their technology expand their field from digital market to physical stores.

Costco has planned to gradually improve their shopping website, but they don't take the online consumption as a threat, "We are not sell convenience. The key to our success is price, value and quality." Costco CFO, Richard Galanti said. And according to the data, consumers actually enjoyed the physical shopping experience in Costco.

Not only the frequency of visits has increased from once every three weeks to the present once a week. Even before Costco worried about the young consumer groups, but now it become the fastest growing group of Costco members and driven the overall average age of members to decline.

For other traditional retailers such as Walmart and Target are actively expand their e-commerce to compete with Amazon. Overall, retail types continues to evolve through the integration of digital and physical consuming experience would be defined the future of retail industry.