Walmart bound to get bigger by going smaller


Good things happen in small boxes. That's what Walmart is counting on with the introduction of its latest store concept — Walmart to Go. First the supercenter, then Neighborhood Market, then WalmartExpress and now Walmart To Go. The boxes just keep getting smaller. (Check out photos of the new format.

But what if Walmart is on to something? What if tomorrow's definition of convenience is ubiquity? Then it makes a lot of sense to start filling in the gaps between the supercenters with smaller formats. 

“Customers’ needs and expectations are changing. They want to shop when they want and how they want, and we are transforming our business to meet their expectations,” said Bill Simon, Walmart U.S. president and CEO, in announcing the company's capital commitment to the smaller format in February. “Customers appreciate the broad assortment of our supercenters for their stock-up trips as well as our small store formats for fill-in trips. By unlocking this growth opportunity and further combining our supercenters and small store formats with an unlimited selection available through ecommerce, we provide our customers with anytime, anywhere access to our brand.”

Tomorrow's generation of consumers are going to be beyond tablet savvy. They'll decide they want something, and with the swipe of a finger it'll be theirs — bought and paid for — all they have to do is pick it up on the way home or have it delivered to their doorstep. Having those smaller footprints would serve both purposes — they could easily be positioned along commuter routes as well as within striking distance of neighboring communities; you know, if same-day delivery ever becomes commonplace. 

That's not to say that that's Walmart's thinking behind all of this. But what if?

Ubiquity may become the name of the new game. When asked what they would do if their favorite retailer shut down its local store, 53% of respondents to a recent PwC survey noted they would locate the next nearest physical store and 40% said they would increase ordering from that retailer's website. Shoppers today assume retailers are everywhere and always connected like themselves, and retailers need to look at store portfolio management more strategically, noted PwC in its report on what lies beyond omnichannel retailing

Walmart wouldn't be alone in acting today on how shoppers might shop tomorrow. Take a look at what rival Target has done by taking product placement to a whole other level. They not only had an entire episode of TBS' "Cougar Town" revolve around the Target shopping experience, but the 1.2 million people who watched that show live (according to Nielsen) had the opportunity to click and buy products placed on that episode through a simulcast on their tablets. If that's not testing the waters on how tomorrow's shoppers might shop, then what is?

Walmart also is not alone in testing ever-smaller formats. DSN reported in January that Target is looking to open a smaller store in the base of an apartment building currently under construction near the University of Minnesota campus that will serve as a test for the new format dubbed TargetExpress. And Giant Eagle earlier this year introduced its new Market District Express, which brought the best of Giant Eagle’s gourmet Market District food stores into the smaller footprint of its GetGo convenience stores. 

Not to be overlooked is Fred's Super Dollar's development last year of a smaller pharmacy format. The 8,000-sq.-ft. locations are half the size of a typical Fred’s. The format was designed to fit into smaller markets — or markets with a lighter population density — where Walmart and other big-box retailers likely aren't. 

Well, that is, until now.

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