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In a recent push to compete better with Walmart, Amazon has cut prices on consumer goods such as toilet paper and groceries.
Amazon has recently been in “investment mode”, pricing aggressively and investing in innovative products. According to an article from The Guardian, “the deep cuts are slicing into the company’s margins – and its profitability. It’s also likely trimming Amazon’s stock price, which peaked at $408 in January, and has dropped to $326.”
These deep discounts on consumer goods support Amazon’s mentality to be a price leader and drive out the competition. They also come at the perfect time to promote their new offerings, Amazon Fresh and Amazon Pantry.
We’ll see how retailers such as Target and Walmart can stay competitive with Amazon while still maintaining their store footprints and employee headcounts.
Walmart recently made a “checkout promise.” Walmart is “pledging to open every register in all stores that sell general merchandise during peak shopping hours,” according to a Forbes article. It also “pledged not to be under priced in-store or online.”
To read The Guardian article, click here.
To read the Forbe’s article about Walmart’s pledge, click here.
