

Wal-Mart told all store managers to match online prices with Amazon - adamfeldman
http://www.reuters.com/article/2014/11/13/walmart-amazoncom-idUSL2N0T30WN20141113

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jtbigwoo
I assume this is really only going to be worth it on big purchases. It's an
interesting inversion of the usual process for discount retailers.

When I was young, my friend's dad managed the K-Mart in our town. In the 70's
and early 80's, K-Mart gave a lot of autonomy to store managers to set sale
prices and do promotions. He would nearly always have loss-leader sales going
for basic stuff like toothpaste and laundry detergent. He assumed that if he
could just get customers in the door for toothpaste, they'd buy enough other
stuff to make up for the loss. It worked, too. After a while, many people
didn't even bother stopping by Target. K-Mart finally forbade loss-leaders in
the late 80's, his sales tanked, and he quit to become a buyer for another
chain. The K-Mart is still there, but it's a ghost town compared to Target and
Wal-Mart.

I wonder if Wal-Mart can pull off the reverse of what my friend's dad did.
Could they get people who ordinarily wouldn't think of going to Wal-Mart in
the habit shopping there by discounting big things?

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jpd750
I don't think so.

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atonse
Oh man I don't know what this says about Amazon's prices, that Wal-Mart had
trouble matching their prices. And we know all the places where Wal-Mart has
cut corners.

I don't even want to think about how badly amazon's warehouse employees are
treated. (Although I've read one long account that wasn't good).

But Amazon has made the purchasing process so smooth, that it's hard to
resist.

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untog
I'm not so convinced about that. Walmart has to spend a ton of money on real
estate in reachable locations, as well as waste space laying out products for
shopping rather than storing.

By comparison Amazon can buy a warehouse in the middle of nowhere and stack
items as high as they will go.

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tracker1
A lot of amazon's costs are shipping, which may be close to a wash with
Walmart... also, Walmart is setup to sell more perishable goods than Amazon...
Given Walmart's supply chain, and Amazon trying to get closer to consumers
with Amazon now charging tax in a lot of locations, many larger items may be a
wash in terms of profit margin between the two.

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joezydeco
Does anyone know what the procedure is with price matching at a store like
Wal-Mart?

I know places like Best Buy had computers scattered all over the place and
salespeople could bring up a browser and check the price themselves.

Wal-Mart doesn't have that. Do they trust you bringing up a price on a
smartphone and showing them the screen? Do you need to go to the customer
service counter and they look it up there? Could you show them a faked
screencap/print of an Amazon page and they would trust that as legit?

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adamfeldman
Given my extensive experience with the (lack of) customer service at Walmart,
people often won't bother to price match because they don't want to wait 30+
minutes for someone to flag down the manager, check the prices, etc for a
small benefit.

But when there's a big price difference, say on a high-ticket item, it's
totally worth the time because you can save money while walking right out of
the store with the item, instead of waiting on shipping.

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toomuchtodo
> But when there's a big price difference, say on a high-ticket item, it's
> totally worth the time because you can save money while walking right out of
> the store with the item, instead of waiting on shipping.

So high-end baby items (automated swings), TVs, laptops, and the like.

I would rather wait the two days (Prime member) or pay the $4/extra for one
day shipping versus having to go to Walmart. Waiting in line for 15-20 minutes
to checkout? Possibly not finding the item or its not in stock? Lack of
helpful staff (not that I blame them!). Nope Nope Nope.

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jpd750
Completely agree. The help in my local walmart is horrific. I have a running
joke with my g/f that I feel like my IQ drops everytime I go in Walmart. As
aforementioned - Amazon makes it SO easy!

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thetrumanshow
I'm guessing the reaction from Amazon will be to immediately put more downward
pressure on the prices on the _key items_ that fuel Walmart's business (those
of which that can be bought on Amazon anyway). I'm sure they know exactly what
those are.

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adamfeldman
Here's how Amazon put price pressure on Diapers.com to force them into being
acquired by Amazon

(via [http://allthingsd.com/20131010/how-jeff-bezos-crushed-
diaper...](http://allthingsd.com/20131010/how-jeff-bezos-crushed-diapers-com-
so-amazon-could-buy-diapers-com/))

"Amazon has a secretive unit — dubbed Competitive Intelligence — responsible
for ordering large quantities of goods from competitors to analyze their
businesses. This division eventually became aware of Diapers.com and its
parent company Quidsi, and dispatched M&A chief Jeff Blackburn to initiate
acquisition discussions.

Quidsi’s founders originally rebuffed acquisition offers from Amazon. So
Bezos’s Amazon sent them a message, Stone [author of a book on Bezos and
Amazon called 'The Everything Store'] explains:

“Soon after, Quidsi noticed Amazon dropping prices up to 30 percent on diapers
and other baby products,” Stone writes. “As an experiment, Quidsi executives
manipulated their prices and then watched as Amazon’s website changed its
prices accordingly. Amazon’s pricing bots — software that carefully monitors
other companies’ prices and adjusts Amazon’s to match — were tracking
Diapers.com.” Diapers.com revenue growth eventually slowed under Amazon’s
pricing pressure, and the founders engaged in acquisition talks, agreeing to a
$540 million buyout.

As Stone tells it, Walmart eventually made Quidsi a better offer of $600
million, but it was too late by then.

“The Quidsi executives stuck with Amazon, largely out of fear,” Stone writes."

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dingaling
Very interesting.

I haven't found Amazon UK particularly 'cheap' for the past couple of years at
least, usually their day-to-day prices are about the same as mainstream and
sometimes rise quite markedly for short periods.

Their primary advantage here seems to be centralised shopping and convenience
of payment.

An example was a book on which they were offering 3 pence discount on the RRP.
Hardly worth bothering about, but very low friction to buy from them instead
of another site offering £1 off because my payment and delivery details are
already lodged with Amazon.

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fma
Whenever I need a Walmart manager for something simple like a propane exchange
it takes a huge chunk of time.

The only reason I would even waste my time with a manager is if the price
difference is huge and there's a chance of me returning it because the product
didn't work out...other wise I'd just pay an extra dollar, or wait a day or
two from Amazon.

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Shivetya
I wonder what the rule is here, one frustrating aspect of dealing with Wal
Mart is far too many items are never in stock and ship to store only. Worse
they arrive late. This includes current movie releases.

Their site is a real mess at times and just finding a store with the item you
want can be a real hassle. If anything it probably drives more to other stores
than the stores themselves

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therzathegza
That's pretty interesting! I've been told at Walmarts they they don't even
match walmart.com as it is "different".

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Jemaclus
This will end well. I'm sure of it.

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edgarvaldes
For Wal-Mart or Amazon?

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Zikes
Yes.

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feld
Walmart hates this one weird trick that gives you incredibly low prices!*

* MITM attack on a Walmart's internet connection that routes Amazon.com through a custom proxy which lowers prices even further.

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Zikes
With all the rumors and articles I've seen about how Amazon.com will show
different prices to different people [1], I wonder if that's even necessary.

I could pull up a product on my Android smartphone in Chrome and see one
price, while a manager on their iPhone browsing Amazon in Safari might get
something a few dollars different.

[1] [http://www.consumeraffairs.com/news/lawsuit-alleges-
amazon-c...](http://www.consumeraffairs.com/news/lawsuit-alleges-amazon-
charges-prime-members-for-free-shipping-031414.html)

~~~
feld
That's dirty. Thanks for linking it.

