According to a recent article by YAHOO! Finance, Walmart reported good financial news, but is disappointed about its e-commerce gains. But we’re not here to talk about that.
We would like to focus in on the following quote from Walmart CEO Doug McMillon, which we at WhyteSpyder feel is very important:
“Our marketplace is ramping up, but it takes time to build the assortment to the point where customers realize the depth of assortment,” McMillon said. “We now offer more than 10 million SKUs on Walmart.com and we are growing that number through a combination of first-party and third-party items. It makes sense that perception will trail reality and we’ll work on both during the course of this year.”
For over a year, WhyteSpyder has been meeting with Walmart suppliers to encourage them to provide Walmart with optimized and enhanced data and content. The reactions are virtually the same for all suppliers, large or small.
- Supplier Reaction: Why should we invest in Walmart.com when it’s only 1% of our total business with Walmart?
- WhyteSpyder Reaction: Walmart’s request for optimized and enhanced data/content is about Walmart’s omnichannel retail strategy to accommodate the modern shoppers. Walmart’s intention to grow Walmart.com is just one avenue/channel within the bigger scheme of omni-retail. Therefore, you (the supplier) should look at a data/content investment for your total Walmart business. Most suppliers are two years behind the omni-shopper. And you will be even more so in the coming months as Walmart unleashes its omni-retail solution – which, by the way, is the best on the planet right now.
- Supplier Reaction: We purposefully do not provide certain products to Walmart as part of our corporate strategy because those products do not fit the Walmart shopper.
- WhyteSpyder Reaction: This was a good strategy for yesterday. Again, you (the supplier) should stop thinking of e-commerce as a single channel business. Look at e-commerce, Walmart Supercenters, Walmart Neighborhood Markets, order online pickup at store, drones, Walmart apps, and distribution centers as the single entity of Walmart. Walmart will be the everything store in physical and virtual space. Opening your product catalog/assortment to Walmart directly will offer key advantages in working within Walmart’s strategy for omnichannel retail. Walmart has already greatly increased its assortment online and will use first-party (direct from supplier) and third-party (Marketplace) relationships to accomplish the greatest assortment on earth. Walmart’s omnichannel strategy has been made quite clear from the top down. The execution is somewhat confusing and things may seem chaotic. But, it still requires investment from you as a supplier.
The strategy is clear and they are moving forward.
Suppliers that “comply” with Walmart will continue to conduct business with the world’s largest retailer and the nation’s most popular store. Suppliers that get behind Walmart’s strategy and help execute and deliver high-quality, optimized, and enhanced data and content will have more sales and opportunities.
As Doug McMillon said: “It makes sense that perception will trail reality and we’ll work on both during the course of this year.”
Suppliers cannot afford to be left behind. Suppliers should have vision. They need to try to see the bigger picture and where this strategy is going.