October 30, 2009, 12:00 AM

…While Wal-Mart takes on Amazon by launching an online price war

Wal-Mart Stores Inc. launched a price war with Amazon.com Inc. last month by slashing the prices of highly anticipated new books that Walmart.com shoppers pre-order. Target Corp. and Sears Holdings Corp. also entered the fray.

Wal-Mart Stores Inc. got to the be the world’s biggest retailer largely by offering the lowest prices. Now it’s extending that strategy to the web, directly taking on leading e-retailer Amazon.com Inc., and forcing Amazon and other major rivals to react.

Wal-Mart set off the price war in mid-October when it began offering for $10 each on Walmart.com highly anticipated books that normally list for about $25 or more. Amazon.com Inc. immediately countered with a similar deal and Target Corp. soon followed suit at Target.com.

“At Walmart.com, we remain committed to providing our customers with the lowest prices available online,” declared Walmart.com CEO Raul Vazquez in announcing the deep discounts. “That commitment extends to the nation’s best-selling books, especially during an increasingly challenging year for many of our customers.”

Wal-Mart initially said Walmart.com shoppers could pre-order for $10 each of the 10 most popular of the books soon to be released by publishers. The lists are based on figures provided by publishers.

71% savings

Instead of paying the $35 list price for Stephen King’s forthcoming novel “Under the Dome,” for example, shoppers could save 71% and have it shipped close to the publisher’s expected release date of Nov. 10.

After Amazon.com matched the $10 price offer, Walmart.com dropped its pre-order price to $9. Amazon again matched that price, prompting Walmart.com, and then Target.com, to lower their prices to $8.99.

Wal-Mart.com, which fired the first shot, went on the offensive with the low-price deal, featuring it on its home page and offering free shipping with no minimum purchase requirement. Amazon, which continues to heavily promote its Kindle electronic book readers and e-books for the Kindle, was not promoting the $9 offer on its home page or book category page, while Target.com featured it on the category page but not the home page.

Walmart.com also promoted discounts of 50% or more off the list prices of the top 200 books already in print. Amazon.com is promoting discounts of up to 45% off the list prices of the top 100 books already in print.

Neither Barnes & Noble Inc. nor Borders Group Inc., two other major booksellers, immediately matched the $9 price, though each offered deep discounts, such as 40% off a pre-order of King’s novel “Under the Dome.”

Meanwhile, Sears Holdings Corp. joined the fray in its own way, offering a $9 discount at Sears.com for any consumer who e-mails a receipt for a book bought at Sears.com, Walmart.com, Amazon.com or Target.com.


comments powered by Disqus




From The IR Blog


Anna Johansson / E-Commerce

Why is social proof big for niche brands?

A small online retailer that lacks brand recognition can get a big boost from high ...


Donn Davis / E-Commerce

Technology takeover: The fashion industry is next

We are now entering the third decade of the Amazon effect, and it is just ...

Research Guides