Until Wednesday, Wal-Mart was siccing its legal team on websites of all types to keep its Black Friday 2009 deals from lighting up cyberspace. At the same time, Radio Shack was e-mailing scanned copies of its "Shack Friday" circular to the news media.
The lesson? Wal-Mart runs the Black Friday show. All others need to hustle to keep up.
But can they?
Many Black Friday watchers are skeptical. Because Wal-Mart maintains lower prices with similar profit margins, the initiative belongs to the Bentonville, Ark.,-based corporation.
"It all depends on how deeply Wal-Mart wants to cut prices. It’s kinda throwing the ball up in the air in terms of Wal-Mart and seeing how it trickles down to the other retailers," says Steven Rogé, portfolio manager at R.W. Rogé & Co., a financial-management firm in Bohemia, N.Y.
There is one retailer that might (at least eventually) take a bite out of Wal-Mart: Amazon.com.
"Black Friday has traditionally been an in-store shopping holiday, but it has also creeped online in a big way as well and merchants have incredible deals online for those people who don’t want to fight the crowds in the stores. This has made a way for Amazon to get into the game," says Luke Knowles, co-founder of Internet coupon distributor Coupon Sherpa.
Amazon's power derives from the migration of consumers to online shopping combined with advances in mobile technology that makes comparison shopping more comprehensive and immediate than ever.
"You’re in Wal-Mart. You see the product you're looking at cheaper on Amazon," via a smartphone, Mr. Knowles explains, "and you can be physically standing in Wal-Mart and buy something on Amazon.com."
It's not as if brick-and-mortar stores are eschewing online sales. Far to the contrary, they are pushing hard into mobile and online retail.
Traditional retail outlets "are trying to find ways to engage that social media a little bit more than they have in the past," says Brent Conver, director of DVDTalk.com. "Before, if anything breaks on the Internet, [retailers think] 'We’re going to lose our in-store purchases.' Now, they are saying, 'We want more Internet activity anyway, so we’re going to make sure that we lead with a few important deals and they’ll pick their spots to drop an important coupon online.' "
But Amazon isn't developing online strategy. It's perfecting it.
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."
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."