Friday, February 1, 2008

E-Retailing Memo: Wal-Mart to Invest Millions, Launch New International E-Retailing Effort

Wal-Mart, Inc. is proving that 2008 is going to be a year of innovation and proactive initiatives for the world's largest corporation and retailer, despite an international economic outlook that looks anything but innovative or positive.

Not only is Wal-Mart preparing its new small-format Marketside grocery stores for introduction later this year in the Phoenix, Arizona region in the U.S., it going full-steam-forward in China, building as many new Supercenters or hypermarkets that the Chinese government will allow the retailer to build.

Further, as we wrote about last week, CEO Lee Scott set the stage for Wal-Mart to dramatically increase its corporate efforts in the areas of social, ethic and environmental retailing and policy in a speech to over 7,000 store managers last week at corporate headquarters in Bentonville, Arkansas.

Now, today's Financial Times is reporting Wal-Mart wants to emulate's global e-retailing success, and is launching an international e-commerce initiative which it hopes will garner the company billions of dollars in new sales in countries such as China, Japan and Brazil, among others.

According to the Financial Times' story, a Wal-Mart spokesperson said the company will spend millions of dollars in what the mega-retailer says is "a multi-billion dollar opportunity over the next three to five years. (You can read the full Financial Times piece here.) Among the goods the new e-commerce site could sell are grocery products.

We should note that Wal-mart is no stranger to e-retailing. It's site in the U.S. is the second most-visited e-commerce website after Amazon. Wal-Mart does about $2 billion in annual sales via

Additionally, Wal-Mart's Asda retail stores division in the United Kingdom (UK) operates a successful online site that offers food and grocery products, general merchandise, electronics and even financial services. Asda just recently announced it would be spending a considerable sum of money to improve the site. It's goal: to target Tesco, the UK's number one brick and mortar and e-retailer.

Despite its many critics, Wal-Mart isn't letting the opposition get it down thus far this year. Only a month into the new year, the company seems to be on the move proactively--both operationally and marketing and communications-wise.

For example, yesterday the retailer announced a program it calls "Wal-Mart's Economic Stimulus Plan," in which it said it's rolling back retail prices by 10% -to- 30% on thousands of items. None of the items are food or grocery items however. Most are consumer products such as electronics, houswares, appliances and the like.

The program taps into all the talk in the news in the U.S. regarding the economic stimulus package (about $150 billion worth) that President George W. Bush and Congress is ready to approve for the American people. This package includes rebate checks which will be sent to taxpayers in April or May of this year. Obviously, Wal-Mart wants those checks to be spent in its stores, giving the company a little economic stimulus of its own.

Wal-Mart-Canada also last week launched a major marketing and communications program in the country. A key aspect of that program focuses on touting the retailer's commitment to environmental sustainability, along with its support for local, Canadian-produced products. Wal-Mart is attempting to feature as many Canadian-produced food and grocery products---fresh produce, meats, packaged goods--in its Supercenters there as it can. The Canadian "green" program is similar to the one Wal-mart has launched in the U.S.

These two proactive marketing and communication programs, along with the preparations to launch the new small-format Marketside grocery stores, the China initiatives, and the major new e-retailing push, are showing an invigerated Wal-Mart.

During the last-half of last year, the retailer wasn't out-front on too many initiatives--although as we've reported, Wal-Mart executives were busy working on the Marketside format. That's all changed; the retailer has hit the ground running for 2008, and there's still 11 months remaining in the year. It should be an interesting year Wal-Mart-wise.

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