Forrester Research, Inc. has concluded that, despite recent improvements to its archaic Web site, Wal-Mart’s e-commerce operation will require vast improvement if it is to mount a serious challenge to Amazon and other industry leaders any time soon.
This scathing review comes a few short weeks after America Online and Wal-Mart Stores announced a wide-ranging strategic alliance that created a new co-branded online service and numerous cross-marketing initiatives between the two companies.
Under the agreement, Wal-Mart customers can now pick up the software for the new online service at many of its 3,600 brick-and-mortar locations.
In return, Wal-Mart.com was given prime placement in the Shop@ areas across all of AOL’s brands.
A Buggy System
The redesigned site, which was unveiled on January 1st, was supposed to bring Wal-Mart up to speed with its competitors. However, the report claims that, “Despite neat bells and whistles like the Toy Finder and Personal Shopping List, Wal-Mart’s site suffers from poor search capabilities and a buggy system.”
Forrester cites the fact that it utilized the search engine for book titles by best-selling author Danielle Steel and received no matches. Additionally, the site was turning customers away from overcrowded servers, and its registration page did not allow the widely-used Ms. as a title.
“For Wal-Mart to catch up to its rivals, it must implement best-of-breed search tools that offer customers fuzzy logic to correct misspellings and exchange Boolean search tools for natural language,” the report asserts.
Wal-Mart Must Deepen Product Selection
Meanwhile, despite finding Wal-Mart’s prices to be very competitive, Forrester warns that the giant brick-and-click’s online offerings are much too meager.
“With only four DVD players for sale, the store won’t lure Amazon purists who get to choose among 19 DVD players,” the report concludes. “Wal-Mart needs to offer rock-bottom prices on a broader selection of merchandise — like 32-inch televisions or five-day cruises — that appeal to Net shoppers’ desire for choice.”
One-Up Amazon With In-Store Pickup
Forrester asserts that along with technical improvements, Wal-Mart must develop an aggressive in-store pickup strategy if it ever hopes to beat Amazon.com.
“Wal-Mart should take advantage of its broad mix and physical omnipresence by offering in-store pick up for orders placed online,” the report suggests. “Online replenishment of diapers and detergent will drive more volume through Wal-Mart’s existing distribution infrastructure and distance it from single-channel rival Amazon for the mass market.”