On Black Friday sales 2009, can Amazon compete with Wal-Mart?
Retailers are pulling out all the stops for Black Friday 2009. But can anyone compete with Wal-Mart?
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Over the last three years, Amazon's revenue has grown an average 31 percent per year compared with 9.1 percent for Wal-Mart. While Wal-Mart's $400 billion-plus revenue last year dwarfed Amazon's $19.2 billion, Mr. Rogé says, "those are quite substantial revenue numbers for Amazon, and those are sustainable probably for the next decade. Ten years from now we’re going to be talking about Wal-Mart in bricks and mortar as a clear winner and online, possibly even competing in the same breath as Wal-Mart, Amazon is going to be right there."Skip to next paragraph
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For brick-and-mortar outfits, the key is to compete on adding customer-service value to every product. By offering free installation, warranties, and friendly, hassle-free service, retailers without Wal-Mart's huge purchasing power could compete on consumer experience once the product is off the shelf.
"If you think back, and if you think Sears, you think, 'I can buy my product here and not worry about anything going wrong. I can buy a Craftsman lawn-blower and I can take it back and they are as friendly as anything and I’ll get a new one. To some extent, that changed over the past couple of years," Rogé says. "To some extent, that’s why a lot of us go to Costco to buy stuff, because we know that pretty much they’ll take anything back. So you can feel safe."
Still, while companies like Target, Sears, or Amazon might be able to match or beat Wal-Mart on a particular product, on balance, Wal-Mart stands alone.
For a particular model TV, for example, "Wal-Mart might not beat that price but Target, that’s their one-trick pony," says Michael Brim, founder of BFads.net. "Wal-Mart is the three-headed monster of Voltron. They're big."