Report: Walmart’s weapon of choice in its war with Amazon—the cloud
A discount giant has found a way to narrow the gap with its online rival, Amazon.
Walmart hopes to take on Amazon in its e-commerce war by crunching almost limitless swathes of customer data in-house. Its weapon of choice: six giant facilities, or “server farms,” that connect to the cloud, according to CNBC, which cited Reuters.
According to the report, each facility is larger than 10 football fields, and the initiative took millions of dollars — and nearly five years — to build. However, efforts are starting to pay off as Walmart’s online sales have been on the rise for the last three consecutive quarters — far outpacing wider industry growth levels.
While most retailers rent the computing capacity they need to store and manage such information, Walmart opted for an internal cloud network, one that mimics Amazon’s use of cloud-powered big data to drive digital sales. The discount giant hopes this configuration will translate into larger portion of online shopping wallet share, the report said.
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Juniper: Global E-commerce sales to rise 10% this year
Online spending continues to climb — and alternative payments are driving this growth.
The value of global consumer spending on remote payments for digital and physical goods will surpass $3.3 trillion this year — up 10% on 2017’s total of $3 trillion, according to “Mobile & Online Remote Payments for Digital & Physical Goods: Opportunities & Forecasts 2018-2022, from Juniper Research.
According to the data, alternative payment mechanisms will comprise an ever-increasing proportion of online spend. For example, PayPal already accounts for 20% of mobile and online physical goods transactions made outside China. Meanwhile, the success of Alipay and Weixin Pay within China means that these two players combined now account for 45% of global payment volumes.
There is also a significant opportunity for more nascent options, such as the various original equipment manufacturer (OEM)-Pay solutions and carrier billing — payment options created by one company and marketed by another. For example, Amazon recently adopted an OEM-Pay option in Japan for physical goods purchases, the report said.
It is not all good news however, as there are still major pain points for merchants and consumers to overcome. For example, European merchants need to be aware of implications of new regulations — and the upgrades required to comply. One is the PSD2 card-on-file regulation that requires consumers to ‘white-list’ or grant approval for their payment details to be stored. It is claimed that Secure Customer Authentication (SCA) obligations could potentially adversely impact conversion rates by increasing friction at checkout, the report said.
The study also revealed that retailers were struggling to resolve issues around customer identification within the broader commerce framework.
“Payment processors and other key stakeholders need to work closely with merchants to ensure they can recognize individual consumers, regardless of device and whether they are purchasing online or offline, to deliver the optimal experience across the retail lifecycle,” said Dr. Windsor Holden, head of forecasting & consultancy at Juniper Research.
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