It wasn’t that long ago that experts were writing about Wal-Mart’s losing the online business game. Then, like now, the focus was on competition with Amazon, the online behemoth that’s on track to be one of the first publicly traded companies valued at $1 trillion.
Fast forward to today and Wal-Mart, still the largest retailer in the world, is going head-to-head with Amazon in a retail war that some are predicting will crush other players who fall behind.
But while Wal-Mart is celebrating its online victories, other major established retail businesses like Macy’s, Nordstrom, Kohl’s, and J.C. Penney continue to struggle.
Why Established Businesses are Struggling to Compete
Here are two major reasons Wal-Mart's winning online:
- The retailer has stayed true to its core purpose.
- It continually makes choices that fulfill that purpose.
When Sam Walton started his business in 1962, he had one goal: to help customers live better lives by helping them save money; that remains Wal-Mart’s mission to this day.
Why are other companies finding it so tough to compete? There are varying reasons, but these three would likely top a lot of online marketing experts’ list. Spoiler alert: they focus on building a company customers love.
Failing to Identify Who Their Customers Are
You hear it all the time: if you want to understand who your customers are, write comprehensive buyer personas. Good advice—up to a point. Buyer personas may be great at helping you stay focused, but customers want to be treated as people, not personas. And as essential as those carefully crafted characters may be to your brand’s success, you can’t build relationships with hypotheticals.
One way Wal-Mart is personalizing its customer experience is by redefining and blurring the distinction between physical and digital retail. Its mobile app has been redesigned to not only let customers easily search for information and order online, but to create highly individualized shopping lists they can use in-store.
Not Understanding What Customers Really Want
We live in a fast-paced world in which customers are more impatient, more demanding, and less trusting of traditional and online businesses. Most of their frustration comes not from what a brand is offering, but how they’re trying to sell it to them. Customers expect companies to:
- Earn their attention, not take up their time with something they neither want nor need.
- Give them solutions to their problems, not tell them why they can’t do that.
- Help them solve their own problems.
- Not make it hard for them when the customer wants to “break up.”
Failing to Look at the Big Picture
Many established businesses still operate on a decades-old, product-centric formula, accustomed to being the place people go to for their products and services. Success is measured in how many items you sell or hours you bill at a predetermined price or rate. And until recently, companies that followed this formula found the payoff was sustained growth.
Today, the destination is often online, less fixed and more determined by where and with whom the consumer decides she or he wants to engage. Put another way, customers are now the point of sale, not the business. For companies used to selling “things,” making the transition to building and maintaining online relationships has been difficult.
Some brands have tried to compete by building websites or Facebook pages while running their companies much like before. But a bigger strategy is needed; one that includes technology, branding, initiatives, design, and SEO and conversion optimization.
For example, investing in a CRM application to track and analyze customer interactions, and using tools like Google Analytics to help you understand the value of an inbound marketing strategy can guide you to a more customer-centric approach.
The Bottom Line
The companies who stand the best chance of online success are those that:
- Have a clearly defined purpose and a culture that reflects and supports that purpose.
- Meet customer expectations, not set them.
- Understand inbound marketing must play a huge role in attracting, converting, and retaining customers.
Can smaller brands copy Wal-Mart’s success? Yes. It’s about finding ways to maximize your visibility, performance, and customer loyalty. In addition to a good CRM, marketing tools like email automation and AI chatbots like Reply.AI can also help personalize your customers’ experiences.
In the end, what will matter most is not how tech savvy a brand becomes, but how savvy it is at using tech to build honest and personal connections with its customers.
You need look no further than Wal-Mart to find the proof. The company’s online sales jumped 44% in 2017 and experts expect its e-commerce sales contribution to double by 2020. And all because they realized they could stay true to their values while understanding the time was ripe for a new approach.