Walmart is undoubtedly an extraordinary business founded by one of the entrepreneurial giants of all time. The company Sam Walton launched sells virtually everything, dominates much of retailing and continues to expand its footprint across the globe.
But as they say on Wall Street, "a tree doesn't grow to the sky." And Walmart is already running headlong into a force that will, ultimately, take it down.
Let's start with Walmart's key value-focused selling proposition: the fact is, the Bentonville-based behemoth is no longer the "Low Price Leader." The internet is.
What do I mean by this? Well, this fall I wanted to buy a pair of sturdy snow boots at the lowest possible cost. Did I turn to Walmart.com? absolutely not. Instead, I headed to Amazon, searched for "snow boots" and found superb options direct from Chinese manufacturers at ridiculously low prices. I have done this before for other products, know some of the manufacturers who sell direct through Amazon, Alibaba or a simple Google search, and lock in unbeatable bargains for quality, durable products devoid of high-margin logos.
If you have access to the Internet, you don't need Walmart's brick and mortar big boxes nor its cyber equivalent.
The fact is, all of retailing is about to undergo the kind of systemic change that will usher in a new era, restructuring the way we buy nearly everything. Within ten years, we will see the following:
*Sprawling retail arenas, like Walmart's Supercenters, will go the way of Blockbuster megastores. The same kind of thinking that asks why drive across town for videos when you can download them from Netflix in seconds will permeate virtually product category.
*An increasing number of bargain finder apps will no longer be used to source the best suppliers, they will find the lowest-price bargains through electronic divining rods and then seamlessly fulfill the order. In this open shopping architecture, we consumers will simply search for products, not for URLs or stores.
*Just about everything will be delivered to your home or office the same day that you order it. Forget Bezo's drones PR stunt: there are already caravans of vehicles -- Fed Ex, Uber, UPS, etc. -- traveling the land, just waiting to bring you what you want when you want it.
*Related to this, in the near future, we will be able to virtually reach in to our phones and tablets and take what we want as opposed to placing an order and waiting for it to be delivered. Even next day will seem to be glacial speed. Think of it this way: today, will you wait a day, an hour or even five minutes for an email? The faster things get, the more impatient we get and the more perfect the logistics must be. (The first time you get what you want in an instant is the last time you will tolerate anything less.)
In a recent interview, Walmart's CEO Doug Mcmillon admitted openly and candidly that the world is changing rapidly, that the retailer is reducing the size of its grandest locations (after finding that the marketplace balked at long walks through stores) and that Walmart must constantly search for ideal mix of brick and mortar and cyber-based retailing to meet the demands of an evolving world. But what he did not address are the real challenging and messy issues that have no easy answers for a company blessed/burdened with 11,000-plus stores:
*Once the tipping point in retail purchasing patterns occurs, the established models will implode.
*Big general stores will soon have as much value of the average person as a box at the end of their driveways to hold their mail.
*The sooner manufacturers (the ones who control the "content") can consummate all of their sales without paying a middleman, the traditional retailer will be history.
And the Internet will have swallowed its biggest victim.