Strategy
It’s Wal-Mart… not e-Wal-Mart. When you are too phisical for the virtual…
December 28, 2007
1

It’s a little that I don’t write something, but I had to deal with a couple of things at the moment, lie the flight to Boston, Christmas and the migration of the data between my old computer and the new one…

This morning I have head the news on this post, that Wal-Mart video download service died.  That really didn’t shocked me because I wasn’t using the service , and I have to say that I have never  went before to see that service… I had heard of that, but I was never inspired to go and look at that. Why it has failed? They had the movies, the technology, the name and the advertising platform. What went wrong?

It’s called Customer Psychological Positioning (maybe it’s called in and another way), and it’s the perception that the customer has of the Brand/Business it self, where it’s located in his mind. Wal-Mart is huge and has the one of the biggest retail systems in the US soil. But Internet is different… Internet is virtual… and has different mechanisms.

Wal-Mart on a market side is considered  by the customers as a big supermarket, where you go and buy stuff, by person… Amazon instead has the biggest online store and users go there to buy goods online and wait them at home. More or less is the same mechanism, but with some differences about the Customer Exerience:

  • Time: On-line in seconds you buy the good without going out from your door. Off-line you have to go out and arrive to the store and buy it, and can take hours.
  • Goods: The goods on-line are always available (or you have to wait a little if the shop is out of stock) off-line you don’t know until you arrive to the shop, to see if there is what you want or not.
  • Payment: As happened with the credit cards when the customers has not the impression to spending money, the same happens online, the distance between you money, the credit card and the initial good is wider… and you feel not to spend money and you tend to purchase more. Off-line you know what you are buying and you pay at that moment, and you are more conscious of what you are buying.

As explained the experiences are different, and so the customers are, the Wal-Mart customers has more confidence in the off-line store experience, and they love it. The internet User instead has a different approach, and he knows where to go and buy… Wal-Mart for him is something completely different from the traditional customer.
Wal-Mart is not the first time that fails online, it tried also to create a social network “The Hub”, also it died…

A suggestion… Wal-Mart stay off-line, your customer doesn’t need to experience you online, they see no difference. They get used in the old way, and they will see you always in that way. If it want to try, has to create a new brand,not bounded by any previous  psychological position of the customers…

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There is 1 comment

  • Francesco says:

    You forget another consideration about the time factor: online you have to wait the goods to be delivered to your door, offline you get immediately what you want.

    This is an aspect not to underestimate, especially in consumer electronics goods. You want to have immediately you new iPhone/Wii/MacBook, so you buy online only if you have a heavy discount, otherwise you choose the old offline shopping experience.

    Talking about Wal Mart I totally agree with you, they’re good offline and not very good online (especially beacause they have different prices that disorient customers).

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