As the retail industry is getting more and more competitive, Walmart has altered its business strategy to compete against their rivals. Looking at this case study through Porter’s Generic Strategies we learned in class, it is evident that Walmart’s approach is categorized under Cost Leadership Strategy. They target a wide market as they sell all types of products ranging from clothing to electronics. They also strive to sell their products below average retail prices to earn a higher percentage of market share.

Target operates in a similar fashion to Walmart by offering low prices, however there is one distinct difference that puts Walmart ahead in market shares in Canada: Target has yet to have e-commerce. Walmart sells their products online as well, meaning they have a larger target market and another source of income stream. Obviously, Target is putting effort into turning their business around. Walmart should not be too confident with their current position in the industry as they can easily lose their competitive advantage. This portion ties into the transient advantage document that we were asked to read. It was a very interesting idea that a lot of companies miss. Walmart may find themselves in the ‘First-Mover Trap’ which is where they believe they have a strong advantage because they were the first firm in the market. However, they are looking towards reaching to a new market of “small-format stores” to fulfill the rising demand of convenience stores.

I believe that this is a thoughtful strategy because by branching out Walmart will have more revenue streams. As I discussed in my previous blog post, consumers are generally wary about new products from companies, but luckily this move aligns with their brand’s values and current consumer’s perception of their brand. This is a benefit for Walmart as consumers know what to expect from their new convenience stores, meaning it should be successful.

Read article here.