Businesses often rely on market innovation to stay one step ahead of their competition. Lately, Walmart is turning out to be a good example of this notion. The company is using its Silicon Valley talent to increase global reach. They have been investing heavily in new technologies, and is looking to give a tough time to online competitors like Amazon.
Technology investments are a good method for companies to improve different aspects in business. The online retail giant Amazon is a good example of this, and now Walmart is looking to follow suit.
Tech based research and improvement
The role of quantitative researchers has also a lot to do with technology investments in various businesses. Worldquant has a variety of quantitative researchers and is a good example of using such researchers in investment firms and improving the efficiency of businesses. Walmart seems to be following a similar pattern where there is more focus towards quantification and automation in the development of its selling processes.
There has been much focus on new software investment and enterprise application upgrades. Quantitation researches lead to development of tailor made applications for controlling operational expenses.
CEO of Walmart Mike Duke highlighted that his company has been recruiting talent for this job and would continue to invest in areas of technologies.
The Walmart Model
Walmart is also leveraging on tech investments on two accounts. First of all, the quarterly earnings for the company were disappointing. In the second quarter, it slipped by 0.3 percent. Secondly, online sales have been a bright point for Walmart and it saw an increase by 30 percent. This has led to the company to increase its investments in the technology areas since it is financially rewarding.
Wal-Mart’s approach clearly shows how e-commerce and cutting edge technology is important in the finance sector and retail businesses. The overlap of technology and conventional retail stores may possibly help Walmart overcome its poor figures.
Companies like Amazon have shown that investments in this area have a consistent record of churning out good returns.
Another thing is that tech investments help in the current market trend where consumers are curbing their spending. Infrastructure costs for such investments are low and would become essential since the low spending behavior may persist for the rest of the year.
Future of approach
Technology investments and specially IT based spending for financial services would grow to around $91 billion by the end of the year. In banking, this investment would grow by 4.8% while in investment services, 5.6% growth is expected.
Walmart is already targeting alternate approaches like opening a store in universities. Just recently, they opened up a Walmart on Campus in Georgia Tech. It would bode well with its technology investment program. This is the second university to have such a Walmart format after University of Arkansas.
The store has been opened in the tech square which links with the technology investment of Walmart. Also, Tech square has been a location of success for some other businesses as well. Its retail destination is ideal for many brands.
The end of the year would show how much Walmart gains from its tech investment and whether its model would go on to become a sustainable one or not.