Friday, September 18, 2009
Wal-Mart
With a combination of low prices and large selection, how is this once super giant of a business scrambling to keep up with other business around them? Because of Wal-Mart’s inability to provide consumers with the qualities they're looking for, consumers are now turning to these other retailers and choosing quality over price. Competitor retailers have been luring in consumers by offering them “greater convenience, more selection, higher quality, or better service”,causing people to shop at these other stores over Wal-Mart. (Wal-Mart Era Wanes Amid Big Shifts in Retail, Gary Mcwilliams)
As a result of these consumers looking for qualities that Wal-Mart doesn’t posses, companies that once played a role in Wal-Marts climb to the top have also been passing up opportunities and deals to sell their products here. For example Pepsi Co, who once played a big part in the Wal-Marts climb to the top a decade ago, choose not to let Wal-Mart participate in the launch of their new energy drink.
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How does this relate to the digital revolution? Does the question of price vs. quality have anything to do with Wal-Mart's status as an early adopter of IT? Does IT help on price but not on quality?
Though the use of IT may be helpful when it comes to price, it isnt always helpful when quality is being questioned. Wal-Mart’s ability to utilize this new digital technology and exercise the first electronic barcode which keeps track of prices and items being sold played a big part when it came to purchasing goods in bulk. Since Wal-Mart was able to purchase the goods like this, it created cheaper prices for customers. Although the goods were cheaper, they weren’t always what customers wanted when it came down to quality.
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