Entering into a new market and attempting to compete with a large corporation such as Walmart, one might attempt to collect data and research ways that one’s small company can compete with such a large brand like Walmart. One strategy that would be beneficial to myself if I were a small business owner attempting to compete with such a large successful brand, since one strategy cannot be cutting prices, would be to collect some sort of Secondary Data that could help me identify why people would want to go there over my store.
Some sources listed in the text such as ACNielsen would be able to assist in tracking sales across grocery, drug, and mass merchandisers. This resource would also provide consumer panel service for tracking retail purchases and motivations. Assuming that my store is a general retail store, how might this information help me? Simply, by knowing this information, I would know exactly what products to carry in my store based on the data that was provided making me aware that possibly my community is only in the market for certain retail products. Part Two
It can be a very intimidating sight, seeing Walmart approach your town with being a small business owner, yourself. Businesses all across the country are struggling to keep their doors open trying to compete with Walmart’s everyday low price. Walmart, essentially, can completely take over a town or market by price-matching any product that they carry that another store has for a cheaper price. This is difficult to small businesses simply because with customers knowing this, it comes across as a convenient one-stop shop, no matter how poor the service is at that particular Walmart.
The plan for my small business would essentially be, not to compete head-to-head with Walmart, but to simply survive in the same market as Walmart. It is unrealistic to think you as a small business owner can compete with a brand such as Walmart, but it is possible to co-exist with such a large brand. One key strategy would be to take a look at the general product that Walmart offers in store and provide the general population a product that they might not carry other than on their online store. For example, when it comes to Vacuum cleaners, Walmart does carry quite a few Vacuum cleaners on their shelf with none of them being higher-tier goods such as a Dyson Vacuum.
Dyson Vacuum is a very successful and quality brand that Walmart does off, unfortunately not in their stores. You would only find a Dyson at their online store which might take 7-10 days for shipping. We are in a generation where we want the product in hand today, not in 7-10 days. This idea can be look at in more than one way as an integrated Differentiation-Focus Strategy. First, this appears as being a differentiation strategy which calls for my company to provide a product or service with distinctive qualities that the customer is looking for.
These can be in the form of customer service that they just aren’t getting at Walmart or it could be higher quality products that simply Walmart does not provide in store. Second, it also appears as being a focus strategy simply by concentrating on a specific customer or market niche. The idea is to not attempt to march Walmart customer for customer, but to serve a limited group of customers better than your competition. This integrated concept has one goal in mind and that is to stand out to the general population within a particular market.
Another strategy in competing with Walmart would be to offer weekly promotions on these higher end products which would essentially catch the customers’ eye and make them think that with this promotion, they can afford a better quality product than what Walmart is offering for what now seems like a reasonable price with this promotion that the customers would then have to wait 7-10 days for Walmart to order matching that price. Customers in today’s society want the product now and not a week from now. An example of this would be the Dyson Vacuum in this situation.
If my store had the Dyson DC25 Animal Upright Ball Bagless Vacuum Cleaner for pet owners, which Walmart is selling for a ROLLBACK price of $44900 from the original price of $44988. If my store had a similar price but offered a promotion stressing an additional discount on this product for this week or by offering an extended warrantee if any part of the Dyson were to break, the part would be covered no questions asked up to three years, that would make the customer feel very special and safe about the purchase they have just made.
After reading up on Walmart for this assignment, one of the biggest issues that continued to be brought up through online topic boards were the constant poor customer service that is offered at Walmart. Personally, I would completely agree and refuse to shop at the Walmart down the street from my house simply because no one reaches out to assist me every time I do go there and when I do there seems to only be 3 registers open with 50 people waiting to check out!
Frankly, that is a very frustrating thing for any customer to go through which is why I would also adopt another strategy and that would be to develop a new customer service standardization that would stand in as the new normal. Customers who value excellent customer service will go out of their way, even if they aren’t getting the lowest price, simply to get superb customer service which is the greatest form of advertising through word of mouth. One customer will here from another how great this small store is and essentially never step foot into another Walmart.