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Walmart reported earnings for its fiscal Q4 2019 (ended January 31, 2019), revealing that its US e-commerce sales grew 43% year-over-year (YoY), marking four straight quarters of either acceleration or flat growth in this metric.
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This also meant an increase of 40% for Walmart’s fiscal 2019 on the whole, in line with the guidance Walmart provided after its weak fiscal Q4 2018. The retailer also enjoyed comparable sales growth of 4.2% this quarter, an acceleration from fiscal Q3 2019, when it was up 3.4%.
After suffering a year of deceleration in its fiscal 2018, Walmart deployed some strategies for fiscal 2019 to bounce back, and it did a solid job following through:
- It’s seriously expanded its online grocery offering. At the end of last year, Walmart intended to double the number of locations handling online grocery, CEO Doug McMillon said in an earnings call. While the number may not have fully doubled, the retailer did add around 1,000 new curbside pickup locations and now offers delivery from almost 800 stores. And the company said that the continued expansion of online grocery pickup and delivery benefited its e-commerce performance this quarter, suggesting that customers are responding positively to the boosted availability. As Walmart expands its online grocery options, it has the potential to take the lead in the market because of its best-in-class store count and superb proximity to consumers: There’s a Walmart store within 10 miles of 90% of the US population.
- Walmart has taken many steps to make its e-commerce offering more attractive to shoppers. These include upgrades to its site, like featuring more images and editorial content, adding VR features to help customers shop for home goods, and adding influencer content. It has also boosted its online product offering through its acquisitions of women’s plus-size apparel brand Eloquii, outdoor retailer MooseJaw, and furniture retailer Hayneedle, in addition to its premium apparel partnership with Lord & Taylor. As the site becomes more enticing and begins offering additional premium products, Walmart will likely become more appealing to shoppers and brands it may want to work with in the future.
- It’s in the early stages of using subsidiary Jet.com to target specific markets.Walmart also planned to leverage Jet.com, which appeals to millennials, to target specific markets instead of expanding its popularity in a broad fashion across the US. The retailer got a start on this tactic in September, overhauling Jet.com with an upgraded look and product selection as well as localization efforts specific to New York City, such as local imagery and emphasis on brands specific to the city. If Walmart.com can add this personalization for other major cities as well, it could help Jet.com penetrate new markets, giving Walmart a stronger presence in cities where rivals like Amazon or Target may currently be beating it.