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Walmart’s Jetblack Is Amazon Prime’s Newest Brave Competitor

A surge in technological capability is fueling an aggressive contest for your money.
June 6, 2018
7 mins read

The debut of Walmart’s newest electronic service, Jetblack, is the retail giant’s latest move toward competing with Amazon’s impressive online presence. Over the past two decades, the companies have been steeped in a combative history of retail marketing strategies as they grow into the Digital Age. Sears, Walmart and especially Amazon comprise retail giants that have constantly evolved and reinvented themselves to suit the needs of their consumers

Sears, Roebuck and Co., popularly known as Sears, started out as a mail-order company and quickly became the sole mail-order company, catering to the public through extensive and detailed catalogs. They continued to expand throughout the course of the 20th century, eventually constructing efficient and operationally fluid retail stores in addition to offering order-from-home catalogs.

However, its success was vulnerable to the introduction of competition. During the late 1990s, new retail stores, namely Walmart, rose to prominence with value propositions that Sears had not needed to contend with in the past.

As a result, the retail company that was once the American household name was unable to keep up with Walmart’s modern, innovative practices, and began to fall down the path toward becoming obsolete. A new retail mammoth had taken over.

So, how has Walmart managed to maintain its position at the top of its market all these years? All signs point to Walmart’s unwavering adherence to its main purpose: helping customers save as much money as they possibly can on all the things they need.

When considering what a customer seeks out in a company to determine its value, all requisites essentially boil down to the two factors that bear the most influence: quality goods and services provided at low prices. By stocking its shelves with such products in droves, Walmart has managed to keep customers coming back for more.

In the long term, the affordability, quality and quantity of the goods and services this super-sized company provides has assisted in building a strong and loyal customer base. Moreover, Walmart has discouraged customers from continuing on with the same old go-to retail stores by giving them the power of choice. This commitment to their core values has taken the company far, but it may not be enough to keep Walmart thriving for years to come.

In this technologically driven world, the value proposition consumers expect from the stores that have everything life requires has become more complex. With the ease of access to computers and the immense capabilities of smartphones, the customer preference for purchasing goods and services online bears similarities to the convenience of ordering from a catalog, which gave Sears its start in retail, but with an unparalleled level of efficiency.

Rather than disrupting their days transporting themselves to and from physical retail locations, the customer’s ideal situation is to simply request products from the convenience of their own homes and have them delivered to their doorsteps in a matter of days.

In response, Amazon has become one of the most rapidly growing companies to both figuratively and literally deliver. The enormous company has conquered the field of online retail after less than 25 years of being in business, captivating its customer base by offering products to order with the click of a mouse or a tap on a smartphone.

Inspiring the need for Walmart to establish Jetblack, the company further expanded its reach with the introduction of Amazon Prime, which allows customers to sign up for a membership and receive multiple benefits for a mere $12.99 per month. Perks include free two-day shipping, access to Amazon Prime Video, an online movie and TV streaming service comparable to Netflix, access to Amazon Prime Music, a music streaming service like Spotify, and more.

The small Seattle startup has grown into a behemoth of electronic commerce, seizing the reins of retail and drawing in billions of dollars of operating income.

Walmart and Amazon have been coexisting for some time, but Walmart is now making moves to beat Amazon at its own game. The company has announced the release of a new service called Jetblack, which will allow customers to order products via text message and have them delivered within a 48 hour time period, a service attempting to outdo the convenience of Amazon Prime.

Although this latest expansion brings Walmart deeper into the electronic commerce industry, it is unclear as to whether it is a potential threat to the dominance of Amazon Prime.

Currently, Jetblack is only available in select New York City locations and costs a rather hefty price of $50 per month. When compared to Amazon’s international scope and significantly cheaper Prime membership cost, Jetblack’s influence seems trivial. It essentially proposes a value proposition very similar to Amazon Prime, but to a smaller audience, for now, at least, and at a greater cost.

Any plans Walmart has of usurping Amazon Prime’s monopsonistic throne will have to come about gradually, while Amazon is free to continue adding even more benefits for its customers. Although the competitive climate between these leaders in the industry is aggressive, the future winner could be any company willing to take its innovative spirit into the arena.

Maya Ramani, University of Virginia

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Maya Ramani

University of Virginia

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