Walmart Gains On Digital, Experience Initiatives

Walmart is roaring forward, thanks to digital innovation and improved customer experience.

While some retailers skated through the holiday seasons on little more than fumes and duct tape (R.I.P., Payless, Charlotte Russe and Gymboree), Walmart just posted financial results that topped expectations, with total revenue climbing 1.9% to $138.8 billion in the fourth quarter of its fiscal year.

Comparable-store sales jumped 4.2% in the U.S. And when viewed on a two-year stacked basis, that gain is 6.8%, which the company says is the highest in the last nine years. Ecommerce sales grew by 21% while operating income rose 36%, to $6.1 billion.

The Bentonville, Ark.-based chain reaffirmed its previous forecasts for the year ahead, which call for a 3% gain in sales and an additional 35% improvement in ecommerce in the U.S.

The company says momentum continues to build in the grocery aisles, with pickup for online orders now available in 2,100 of its 5,300 U.S. stores. By the end of the year, it intends to increase the number of stores offering pickup to 3,100, and double the number of locations offering grocery delivery to 1,600.



Walmart says the gains are broad-based, with customers responding to pricing strategies, omnichannel options and improved private brands. (The early release of February SNAP assistance also gave sales a boost.)

And in more proof that it’s shifting emphasis from expansion to improvement, the retailer says it intends to open fewer than 10 new stores in the U.S. while investing about $11 billion on store remodeling, ecommerce, technology and customer initiatives.

That focus on improved customer experience is paying off for other retailers, too, according to recent research from the International Council of Shopping Centers. In that study, 80% of customers say that a positive customer experience leads them to shop again with a retailer, 73% say the positive experience is likely to make them spend more than they originally planned and 73% say they are more likely to recommend the retailer to a friend. Conversely, 71% say they no longer shop at a store after a poor customer service experience.

Overall, 65% of consumers in the ICSC survey, based on 1,000 adults, say they factor customer-service experiences into decisions about where to shop. Urban consumers, who presumably have more retail options, are most likely to think about customer-service quality when shopping, at 76%, compared to 61% of suburban shoppers, and 59% of those in rural areas.

For those shopping in physical stores, long lines, not being able to find an employee to help and negative employee interactions top the list of frustrations. Online shoppers find shipping fees, getting the wrong item, and complicated returns most vexing.

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