There’s no doubt that the brick and mortar retail sector has been struggling. However, at least one brick and mortar retail chain not only sees a solution to these struggles, but is acting on it fast. That chain is Wal-Mart. While most companies in the sector are struggling, Wal-Mart is having a great time in the market, and for good reason. Efforts to increase e-commerce sales are working, and in a big way!
Consumer Habits Are Changing
Before we dive into just what Wal-Mart is doing, it’s important that you understand why they’re doing what they’re doing. As mentioned above, the brick and mortar retail sector in the United States and around the world is struggling at the moment, and for good reason. It all has to do with consumer habits.
When the internet first came into play decades ago, it was simply a source of information. However, it has evolved in a big way since. These days, the internet is not only used for information, it’s used as a way to digest entertaining content, connect with friends and family, make business happen, and most importantly in this context, shop!
Amazon, Ebay, and several others have all made their name in the online shopping space. While this may be a great thing for online retailers, it’s not necessarily a good thing for brick and mortar retailers. After all, if consumers can shop from the comfort of their own home, why would they waste the gas to drive to their favorite brick and mortar retailer? This combined with the fact that online retail requires little overhead making prices cheaper online is all but putting brick and mortar retailers out of business. That is, with the exception of Wal-Mart
Wal-Mart Is Embrasing This Change In Tides
While most brick and mortar retailers are scrambling to find a way to combat the reduction in foot traffic to their stores, Wal-Mart is well ahead. In fact, the company has been running an e-commerce division for quite some time, and the last earnings report showed that they are doing a great job at it.
In fact, in the last quarter, Wal-Mart saw massive growth in their e-commerce division. Gross revenue in the division was up by a massive 69%. This is largely the result of the company’s aggressive acquisitions that we’ve seen as lof late. For example, they’ve acquired Jet.com, ShoeBuy.com, MooseJaw, and ModCloth lately, all of which add to the company’s e-commerce portfolio.
On top of that, the company is working to give online shoppers more options, and doing a very good job at it. In fact, today, the e-commerce Wal-Mart store boasts around 50 million different products to choose from. That’s a massive jump from the only 10 million products that were available last year.
Finally, the company made another big change that is in direct competition with Amazon. You see, Amazon offers Amazon Prime, giving consumers the ability to get free two-day shipping. In order to compete with this model, Wal-Mart now offers free two-day shipping on ALL orders of $35 or more.
What To Watch For Ahead
Moving forward, Wal-Mart is likely to present several opportunities for binary options traders. However, if you want to take advantage of these opportunities, it’s going to be important to keep a close eye on the news. In particular, follow the company’s journey through taking a lion’s share of the online shopping industry. If they do anything like what they did in the brick and mortar side of things, the stock could fly. However, if the company trips, it could be bad news for investors, but great news for binary options traders interested in profitable put options.