By  on September 4, 2009

Wal-Mart Stores Inc. is out to grab a bigger piece of the e-commerce pie.

Wal-Mart Marketplace, the retail giant’s latest salvo in the online shopping wars, is expanding’s assortment and broadening its range of prices. The program is bringing select retailers to, where they will sell products seamlessly integrated into the Web site. Consumers’ only hint the item isn’t supplied by is a discreet box on the product page that says “Sold by Wal-Mart Marketplace” and the name of the retailer in small type. is handling orders and the retailers are responsible for fulfillment, shipping, customer service and returns. declined to discuss the terms of the partnerships.

So far, Marketplace consists of only three retailers, but Wal-Mart promises many more. “We’re really bullish on the program,” said Ravi Jariwala, a spokesman. “We’re really focused on this and interested in growing Marketplace in the future.”

Already, the retailers — CSN Stores (home, baby, toys, sporting goods and shoes); eBags, (handbags and luggage), and Pro Team, a subsidiary of Dreams Inc. (licensed sports apparel and collectibles), have added nearly one million new products to the assortment.

The strategy, if successful, could win new consumers, who in turn may give Wal-Mart brick-and-mortar stores a second look. “This changes who the customer is,” said Carol Spieckerman, president of Newmarketbuilders, a retail consultant based in Bentonville, Ark., where Wal-Mart Stores’ headquarters is located. “Basically, it’s a new statement that is not necessarily about low prices. Now that they’ve perfected all the metrics in terms of how dot-com is driving traffic to the stores, can expand and become more relevant to different kinds of customers.”

Jariwala said 90 percent of customers shopped at a Wal-Mart within the last month, and more than 50 percent shopped in one in the last week.

“Having higher prices is not a function of having a different customer demographic [online],” he said. “Because we have virtual shelves, we don’t have inventory or space constraints, so, of course, we can offer a much broader selection in electronics, apparel and home in a variety of different price points.”

While Marketplace was developed to give customers more choices, it’s not just about stockkeeping units. The third-party retailers are introducing higher prices and labels and designers rarely, if ever, seen on

For example, there is Ed Hardy’s Rebel Luella lace-up handbag, $300, and Vanessa Austrian Crystal Multi Clutch, $500, courtesy of eBags. CSN Stores offers Nina evening sandals for $69.95, Franco Sarto platform sandals, $73.95, Aerosoles’ wedge suede boots, $120, and Dan Post ostrich boots,$279.

“People are going to feel differently about Wal-Mart and stay with it not only on the Internet, but start to think of it as more interesting and approachable for bricks and mortar,” said Joan Treistman, founder of the Treistman Group, a market research firm specializing in Web site optimization. “It’s a big deal for Wal-Mart. It has far-reaching potential.”

One sticky question declined to address is whether the participating retailers will need approval from the designers sold on their own Web sites, to offer those designers’ products at Treistman said, “It really depends on the economy to some extent. Michael Kors has outlet stores, and they have products that are branded somewhat differently and priced differently. If Michael Kors is willing to have his name associated with an outlet store, it seems to me that eventually, these brands are going to come around [to selling on], although not all will.”

“Currently we are not on, and we have no plans to be on,” said a spokesman for Michael Kors. “That’s not part of our strategy. We would never do Collection. We don’t do a lot of off-price and mass market with current live product. We do sell on”

The largest brick-and-mortar retailer in the world, Wal-Mart has made no secret of its online ambitions. According to Internet Retailer, had sales of $1.7 billion last year, making it the 14th-largest online retailer., the top-ranked e-commerce company, had sales of $20 billion in 2008, and Apple displaced Wal-Mart as the top music seller.

Wal-Mart is keenly aware it’s reaching the saturation point in many U.S. markets and sees as a growth vehicle. gets 40 million unique visitors every month and as many as 80 million during the holiday season. Jariwala said the customer tends to skew “a little more female, with a slightly higher income and slightly more education.” The site’s target customer is 25 to 54 years old with a household income of $60,000-plus a year, Spieckerman said. “Looking at those types of statistics,” she said, it’s easy to see how “more aspirational customers might start looking at the Web site and raising their perception” of noted the divergent online strategies of Wal-Mart and competitor Target Corp., which said last month it will rebrand and redesign its Web site and bring it in-house by 2012. The store has been run by Amazon. “Target experienced some inefficiencies it feels it might remedy on its own,” said Treistman. “They might be able to do that. If not, they may partner with someone else. The decision relates to the desire to be more cost efficient.”

“This is Wal-Mart really getting a jump start,” Spieckerman said. “Target is taking the site back and incubating it. Wal-Mart is out and proud and making these big moves.”

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