Specialist
Former director at Walmart Inc
Agenda
- Trends and developments in the mass merchant sector, focusing on Walmart (NYSE: WMT)
- Demand trends within the apparel segment, private label positioning and holiday shopping dynamics
- Competitive positioning and trends vs competitors such as Amazon (NASDAQ: AMZN) and Target (NYSE: TGT)
- Medium-to-long-term outlook, including potential impacts from heightened store thefts
Questions
1.
What is your outlook for the US mass-merchant retail segment as 2022 comes to a close?
2.
Data from a recent survey of US holiday shopping trends seemed to favour Walmart as the top destination for in-store shopping by the survey’s respondents. Could you discuss the resurgence of in-store shopping and how sustainable you think this might be for a player such as Walmart?
3.
When we think of Walmart’s efforts to drive consumers to shop in-store vs online, do you find that a higher mix of in-store shopping vs e-commerce is something that its management would have wanted to see today?
4.
Having browsed Amazon quite a bit, it seems as if I get the very similar haloing effect that you just mentioned, where I’m looking for a product and then Amazon tends to suggest that, because I’m looking at this, I should also look at that, and then I end up also looking at that other item that I didn’t intend to buy in the first place. Does Walmart’s platform tend to not be as good on that front vs how it is able to get that halo effect in stores?
5.
The survey I previously referenced also pointed to online holiday purchases being more favourable towards Amazon. Amazon was essentially the number one choice there, trailed by Walmart.com and then Target.com. What are your thoughts on the gap between an Amazon and a Walmart.com narrowing, and how meaningful do you presume that gap is? Do you see that gap narrowing further any time soon?
6.
What’s your prognostication of what is actually happening and how consumers are potentially approaching e-commerce journeys?
7.
What are your expectations for how the remainder of the 2022 holiday shopping season may compare relative to 2019 and 2021? Might we see the same winners and losers in 2022 as we did in 2019 and/or 2021?
8.
What are your thoughts on Walmart’s inventory positioning going into the holidays and beyond?
9.
What are your thoughts on Walmart’s merchandising strategy and its current positioning vs its closest peer, Target?
10.
Are you expecting any meaningful changes to Walmart’s merchandising going into 2023, considering how consumers may shift to more needs-based shopping vs wants-based shopping – so staples vs discretionary – given a looming recession?
11.
What are your thoughts on specific pockets within apparel that you think may have a stronger or weaker demand in the current economic climate?
12.
How is Walmart positioned to address the potential trend of consumers looking to trade down to lower-cost alternatives? The company is widely known for its pricing proposition, but how robust its private label apparel portfolio vs a player such as Target?
13.
You noted Target specifically potentially having an advantage. Recently there was a bit of momentum or social velocity regarding Target’s miss on apparel, specifically women’s apparel. Any thoughts on that specifically?
14.
What are your thoughts on Walmart’s strategy to potentially fuel the sales of its owned brands vs national branded products such as that of Hanes and Fruit of the Loom?
15.
Is there a different approach you notice with how e-commerce is executed vs offline?
16.
Do you see larger demand for Walmart’s owned brands in the current environment, and in this case, do you think this might end up yielding a permanent shift?
17.
What are your expectations for when inventory levels might be normalised for apparel, and including innerwear?
18.
Are there any parts of the supply chain where you believe inflation still exists?
19.
Store theft recently surfaced as an issue that prompted Walmart’s CEO Doug McMillon to warn that stores may close if theft does not slow. Some reports have previously pointed out that the company loses upwards of about USD 3bn per year to theft. Could you comment on this? Why is this just now surfacing as a problem that is being talked about by management?
20.
How likely is it that Walmart will actually end up closing stores due to theft? We’ve set the context now. Relatively speaking, it’s a small number. What does the alternative look like? Could it invest more in security, or is that not worth it?
21.
What are your expectations for Walmart over the next 12 months? What do you think will be the top three focus areas and/or key risks that we should keep an eye on for the company looking at 2023?
