Walmart CEO Doug McMillon said the largest U.S. retailer is constantly adjusting to experiences and events and noted that a year of pandemic-related change and challenges confirmed the company’s commitment to its omnichannel strategy.
The comments came in McMillon’s letter to shareholders within Walmart’s 2020 Annual Report, which both reflected on the past and pointed to the future by outlining several key areas that the company was focusing on as it begins “the next chapter.”
“We have made gains in recent years that we’ll protect, including the value for customers we offer and the lead we’ve built in pickup services,” McMillion said. “We’re broadening the scope of products and services we offer to increase relevance in more customers’ lives, while layering in a more robust digital experience to improve engagement.”
Faster Sales Growth
In stressing its accelerated investments — as well as a spate of global divestitures — McMillon said all the moves were aimed at supporting faster sales growth and keeping the company’s core businesses “fresh.”
Although the company is coming off its best year in its 60-year history, the Walmart chief said the retailer needed to “move even faster” to seize opportunities and outlined three key areas where it will focus investment.
First, Walmart plans to add eCommerce fulfillment capacity and automation either through the development of new facilities or within or adjacent to existing stores to increase pickup and delivery capacity and improve productivity.
“The market has experienced outsized growth in online shopping since the beginning of the pandemic, and we believe this trend will continue,” McMillon said.
Second, the company is committed to building the reputation and customer retention abilities of its newly launched Walmart+ membership platform, which competes directly with Amazon Prime. In addition to increased fulfillment and capacity investments to stay ahead of rising demand, the retailer said it planned to add new member benefits over time to make the site more appealing.
Third, Walmart plans to expand the assortment goods it sells online to ensure it has the brands customers are looking for.
In recent weeks, Walmart has put up $350 billion to grow U.S.-based business, hired an A-list fashion designer to revamp a line of clothes and launched its annual Open Call competition to discover new brands looking to step up to the so-called big leagues.
Investing In People And Planet
In addition to paying out over $1.6 billion in COVID-related bonuses to it employees, hiking wages for 590,000 other associates over the past six months and moving to a business model that has over two-thirds of in-store staff working full-time, Walmart is also doubling down on the “regenerative company” platform it unveiled last fall.
The company’s embrace of social justice, community involvement, environmental and sustainability reforms comes at a time when corporate support for those issues has become increasingly important to consumers and can be the difference between winning and losing a customer — especially among younger Gen Z and millennials.
Even so, McMillon stressed that it is not a time for timidity or hesitation. “As we enter the next stage of our growth story, we’re doing it from a position of strength. Now is the time for us to be aggressive and invest to accelerate growth,” he said. “We’re moving quickly.”
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