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Walmart vs. Amazon: How America's Biggest Box Store Intends To Revolutionize E-Commerce

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Racked is no longer publishing. Thank you to everyone who read our work over the years. The archives will remain available here; for new stories, head over to, where our staff is covering consumer culture for The Goods by Vox. You can also see what we’re up to by signing up here.

Walmart is a bit off the e-commerce radar, especially when it comes to fashion. The box store is the world's biggest general merchandiser, doing brisk business in books, music, DVDs, electronics, and toys, as well as holding the title of country's largest grocer, but until recently, Walmart was counting on customers to come in to stores to get all that good stuff: 96% of Americans live within 20 miles of a Walmart, which means most people are just a short drive away.

Like everyone else in retail, however, Walmart is reeling from the effects of mobile shopping. Showrooming, the practice of browsing product in store but purchasing via mobile for a cheaper price, has completely changed the landscape for brick-and-mortar powerhouses. And mobile's not just for the rich: tablets and smartphones now sell for well under $200, which means lower-income families are already turning into online customers, according to FastCompany.

Amazon, that Brick-and Mortar Angel of Death, is also reportedly making moves into Walmart's territory of household necessities, letting customers subscribe for items like like diapers, soap, pet food, and cereal that they want to receive regularly.

So Walmart has decided to get its digital act together. The December issue of FastCompany has an excellent profile of the company and its new digital strategy written by Farhhad Manjoo that explains just how Walmart intends to outpace Amazon in the digital realm. We summarize after the jump.

Since 2011, when Walmart invested in a tech team they call WalmartLabs, the company has revamped its digital presence. Here are a few highlights of the improvements, as reported by FastCompany:

1. got a brand new search engine
Here's an anecdote that shows just how backwards Walmart's website was before 2011: FastCompany reports that board-level executives at Walmart were running searches and discovering that a query for "smartphones," got you cell-phone chargers and "cotton socks" returned results for cotton candy and balls of yarn. "This is embarrassing," was the executive consensus (which, honestly, it was). Improved search has increased the visitor-to-buyer conversion rate on by as much as 15%. And now, if you search for cotton socks now, you'll actually find them.

2. Walmart is all over the "social gifting" market
"Social gifting" is where companies use social media cues to suggest presents you might like to give your internet friends (who are also presumably your friends in real life). Just before the holiday season last year, launched a gift-recommendation app called Shopycat on Facebook. FastCompany explains: "Shopycat scans your friends' profiles to identify interesting gift ideas from their stream of likes, comments, and status updates, discerning if the "Ted" your pal is raving about is the geeky ideas festival or the Seth MacFarlane stoner comedy. Shopycat then seeks out an appropriate gift for such a stoner/thinker from Walmart's product database."

3. The company is leading in same-day shipping
One of the more annoying things about online shopping is waiting for your package to arrive. With Walmart's extensive supply chain and strategic distribution centers, they're one of the few retailers in a positition to eliminate that annoyance. They launched a same-day shipping test this fall, which FastCompany interprets as a clear signal of Walmart's serious intent to compete in digital e-commerce.

4. They're making smartphone apps that are actually relevant
FastCompany explains: "Walmart imagines that as you go through an average day, you'll remember things you need—milk, bread, a new tennis racquet, a toy truck for your nephew's birthday—and tell the voice-enabled Walmart app. The app will list each item's location inside your local Walmart and include product info; eventually, it will also learn your preferences and offer recommendations. And once you're actually in the store, you'll be able to summon an associate to help you." Also, as part of a mobile checkout experiment in select stores, the app will keep a running tally of your total bill as you shop.

In our opinion, one of the failures of branded apps in the retail market is that they're often simply a mobile (and more frustrating to use) version of a store's website. By combining what people like about mobile and what they like about actually going in to stores, a la Foursquare, Walmart has a chance to revolutionize the way retail thinks about mobile.

There's lots more great info in the article, so head over here to read the whole thing if you're interested. And also, we're curious: have you ever shopped Walmart's website? How does it compare to other box store e-commerce (like Target, for example) in your opinion? Speak your mind in the comments.
· Walmart's Evolution From Big Box Giant To E-Commerce Innovator [FastCompany]
· Are You Guilty of Showrooming? [Racked]