Mục ý kiến chuyên gia US Big-Box Retailers’ E-Commerce Strategies

The US retail market is one of the largest and most competitive in the world. In recent years, e-commerce has become a growth driver in the US retail industry, with online shopping booming. This trend is influencing the business operations of large retailers. They are making significant investments in e-commerce and exploring new business models that tie in with their existing offline presence. Many sellers who sell on online platforms are interested in entering the offline retail space of the US retail industry. In this article, we will analyze the e-commerce status of large retailers in the US and identify what you need to know as a seller entering the US market.

According to Statista data released on June 20, 2024, the US e-commerce market is expected to continue to grow, totaling $657.8 billion (+53.79%) from 2024 to 2029. This is also the 10th consecutive year of growth that began in 2019. Following this trend, e-commerce shopping by US consumers is expected to reach a new peak in 2029, surpassing $1 trillion and reaching an estimated $1.8 trillion. ^[1]

This growth in e-commerce is not something that can be overlooked for companies that have traditionally relied on brick-and-mortar stores as their primary business model. While Amazon has an overwhelming share of the US e-commerce market, traditional big-box retailers such as Walmart, Target (TGT), The Home Depot, and Costco are also focusing on their online businesses.

In 2023, Amazon, the world's largest e-commerce company, generated approximately $135 billion in US sales, while Walmart recorded about $65 billion. Other successful shopping websites include Apple, Home Depot, and Target. ^[4]

Actively leveraging traditional retail e-commerce First, let us look at traditional retailers in the US. Most of the existing e-commerce reports are based on online sales analysis. This means that existing e-commerce data is limited when it comes to understanding how retailers are utilizing e-commerce with stores across the U.S. Therefore, we turned to the National Retail Federation's Top 100 Retailers 2023 List. This report identifies the top 100 U.S. retailers based on several criteria, including the number of brick-and-mortar stores and sales data for 2022. ^[2] The following table shows revenue and the number of brick-and-mortar stores for the top 20 among 100 companies.

Let us look at which of these top 20 companies will be the biggest e-commerce performers in 2023. When you look at the 2023 US e-commerce market share data from Statista, you will find many traditional big-box retailers.

Among the top retailers by sales in 2022, the companies that will have the largest US e-commerce market share in 2023 are Walmart, Target, Home Depot, Costco, Best Buy, and Kroger. There are two product categories that are currently performing well with online stores: electronics and fashion. TJ Maxx, an American fashion retailer, is one of the companies that needs attention. While TJ Maxx is a leader in the US fashion retail industry, it is only recently focused on online business, so it will be interesting to see how the company expands its e-commerce presence.

Let us look at the online store businesses of the seven companies listed above to see how they are doing and what they can teach us about traditional big-box retailers’ e-commerce insights. The state of e-commerce for each US big box retailer To analyze the current state of e-commerce, we use the January 2022 and January 2023 data for each company. While it is recommended to analyze the most recent data, there are some companies whose baseline data for January 2024 is not completely consistent, so we use data from 2021 and 2022. In addition, some companies do not separate retail and e-commerce sales data, and in the case of data collected through economic information channels, some companies do not separate revenue and sales data. The company data referenced in this article should be considered as data to understand the e-commerce status of the company. To understand the e-commerce status of a company, refer to the total sales, e-commerce sales, e-commerce sales ratio, and e-commerce growth rate data.

As traditional consumer goods retailers watch the growth of e-commerce giant Amazon, it is easy to imagine how many times they have thought about how to prepare for online sales and how to develop specialized services for customers beyond e-commerce. The biggest advantage that traditional distribution channels have from an e-commerce perspective is their omnichannel implementation, which is not easy for Amazon to replicate. Omnichannel is a business strategy that aims to provide consumers with a seamless and natural shopping experience across all channels: store, mobile, and online. It is a business strategy that traditional big-box retailers do best, and it is the best tool they have to compete with Amazon. Let us delve into each retailer's strategy from an omnichannel perspective.


■ Walmart
Walmart, the world's largest retailer, has been aggressively expanding its online store to counter the rapid rise of Amazon, the world's largest e-commerce giant. With an extensive network of brick-and-mortar stores, Walmart continues to strengthen its e-commerce capabilities by leveraging its logistics and deep supply chain management knowledge. As of January 2023, Walmart reported total sales of $611.3 billion, online sales of $73.2 billion, online sales growth of 12%, and online sales percentage of 13%, according to the company's earnings data. ^[6][15]

■ Walmart’s E-Commerce Omnichannel Strategy
• BOPIS (Buy Online, Pick Up In Store): A service that allows customers to pick up items they order online at their local Walmart store, which reduces wait times and maximizes convenience.
• Same-Day Delivery: This service allows customers to order items online and have them delivered on the same day. It is especially useful for perishables and urgently needed items.
• Mobile app: Walmart's app allows customers to shop, track orders, check inventory, and find items in the store to make their shopping experience seamless.

■ Costco
Costco is known for its membership-based warehouse model, offering bulk goods at discounted prices. While Costco has traditionally focused on brick-and-mortar sales, it is also a big player in e-commerce for electronics, appliances, and groceries. According to data released in January 2023, the company reported revenues of $242.3 billion, of which $38.8 billion was e-commerce sales or about 16% online. Costco's online sales grew nearly 7% year-over-year. ^[7]

■ Costco’s E-Commerce Omnichannel Strategy
• Member-only offers: Provide member-only discounts and benefits both online and offline. Members receive the same benefits across all channels.
• Consistent pricing: Maintain the same pricing policies online and offline, ensuring price consistency no matter where customers shop.
• Pickup and delivery services: Offer the ability to order online for certain items and pick them up in-store or have them delivered to your home.


■ Target
Target has established itself as a trendy yet affordable retailer in the US. It sells a wide range of products from apparel to groceries. In its January 2023 earnings report, Target reported $107.4 billion in total sales and $19.4 billion in online sales. That is 18% of total sales, and the online business grew 2% year-over-year. ^[8] On the other hand, some believe the company has gone too far in its support of LGBTQ people. This has led to consumer backlash, boycotts, declining sales, and a plummeting stock price.^[13]

■ Target’s E-Commerce Omnichannel Strategy
• Drive Up Service: Enhance the shopping experience by maximizing customer convenience with a service that allows customers to pick up their online orders outside the store in their car.
• Acquisition of Shipt and service integration: In 2017, Target acquired delivery service platform Shipt to enable same-day delivery. This allows customers to receive their online orders quickly.
• Provision of consistent experience: Offer the same promotions and discounts both online and offline so that customers get the same benefits in either channel.


■ Home Depot
The Home Depot is the largest retailer of building materials, home improvement tools, and DIY-related products in the US. While it has traditionally relied on brick-and-mortar stores, it is expanding its e-commerce capabilities across a wide range of DIY tools, tools, appliances, and building materials. In January 2023, Home Depot reported total sales of $157.4 billion, of which online sales were $24.6 billion, or about 16% of overall sales. Year over year, online sales grew about 6%. ^[9]

■ Home Depot’s E-Commerce Omnichannel Strategy
• Pro Xtra Program: A loyalty program available both online and offline that offers special discounts and benefits for professional (Pro) customers.
• Inventory Management: Allows the checking of inventory status in real-time online and is linked to in-store inventory for the provision of accurate information.
• Project Management Tools: Provide online tools for customers to plan their projects and manage the materials they need, creating a more seamless experience when they visit an offline store.


■ Best Buy
Best Buy is a leading electronics retailer that is effectively transitioning to an e-commerce-centric business. Of the 7 large US retailers in this article, Best Buy has the highest percentage of e-commerce sales (38%). In a 2024 report on US e-commerce published by Statista, electronics and fashion accounted for the largest share of e-commerce shopping. ^[4] It seems natural for a US electronics retailer like Best Buy to focus on online business in order to survive in the business ecosystem. ^[4] Best Buy's total sales in January 2023 were $46.3 billion, of which online sales were $16.4 billion, or 35% of the total. ^[10][14] Best Buy's e-commerce performance compared to its peers can be attributed to its competitive online selling prices, and online customer-specific support, which ultimately enhance the Best Buy customer experience.

However, the table shows Best Buy's declining sales and negative growth compared to its peers. Unlike retailers like Walmart and Costco, which primarily sell food and basic necessities, Best Buy is more sensitive to the consumer economy because it sells high-end electronics. Electronics are one of the most common categories of goods that consumers hold off on purchasing when they feel the economy is unstable. They are different from basic items. When American consumers feel good about their pocketbooks, they change electronics/cars, travel, and eat out. The media reports that the economy is doing well, and the employment numbers are looking good, but there is a reasonable doubt that they are biased because the US is in the midst of a presidential election. The value of employment data is that it reflects quality employment, and the decline in Best Buy's sales can be used as a barometer of how consumers are feeling.

■ Best Buy's E-Commerce Omnichannel Strategy

• Geek Squad Services: Schedule technical support and installation services online and receive in-store assistance.
• Open Box and Refurbished Merchandise: Open box and refurbished merchandise ordered online can be viewed and picked up in-store.
• App and online tools: The Best Buy app allows customers to search for products, track their order, locate products in-store, compare prices, and more.


■ Kroger
Kroger is one of the largest grocery retailers in the United States. The company offers specialized online grocery services, including home delivery and in-car pickup. It is expanding its e-commerce business. According to data released by Kroger in January 2023, the company generated $148.3 billion in revenue in 2022. While the company did not disclose exact numbers for online sales, some media outlets have reported a 12% year-over-year growth, which suggests that online sales accounted for about $14.3 billion in sales. Online sales also accounted for 10% of the company's total sales. ^[11][16][17]

■ Kroger’s E-Commerce Omnichannel Strategy

• Kroger Pickup: A service that allows customers to pick up groceries ordered online in-store, allowing them to pick up their items without having to get out of their car.
• Same-day delivery and scheduled delivery: Provide flexibility by allowing customers to choose a delivery schedule that fits their schedule. This allows for personalized service that fits around the customer's lifestyle.
• Online coupons and discounts: Provide digital coupons and discounts that customers can redeem online and save more benefits. Over the years, Kroger has evolved from an offline-centric customer service to an omnichannel experience that rewards consumers across all platforms, both online and offline.


■ TJ Maxx, TJX Companies
TJX Companies, which owns TJ Maxx, Marshalls, and HomeGoods, is a leading off-price retailer. An off-pricer (also known as an off-price store) is a store that sells products at a price well below the list price. They buy products in bulk and at a discount from branded manufacturers or wholesalers. However, the products may be out of season or overproduced. That is why TJ Maxx does not have a set product lineup, but instead offers a wide variety of brands and products that change from time to time.

This is why TJ Maxx has always been focused on brick-and-mortar shopping, but it is gradually ramping up its online business. According to data released by the company in January 2023, sales were $49.9 billion. TJ Maxx reported that online sales are growing modestly, thanks to the company's efforts to balance the traditional in-store experience with the convenience of online shopping. ^[12] TJ Maxx also reported that while its e-commerce sales are growing at double-digit rates, online sales account for about 1% of its annual sales, with e-commerce sales totaling $477.9 million in 2023. ^[18]

■ TJ Maxx’s E-Commerce Omnichannel Strategy
• Online and offline shopping integration: Offer a BOPIS service that allows customers to pick up and return items ordered online in-store.
• Personalized customer experience and marketing: Analyzes customer data to provide personalized recommendations and promotions, and delivers personalized marketing messages via email, SMS, and social media.
• Unified inventory management and logistics: Manage inventory across online and offline stores, so customers can see accurate inventory information across all channels. This minimizes customer frustration due to out-of-stocks.


When we look at the omnichannel strategies of online stores operated by US big-box retailers, we see several common characteristics:

1) Unified customer experience: Big-box retailers offer a consistent brand image and service both online and offline. For example, when customers shop through a website or mobile app, they see the same promotions and product information they would in a brick-and-mortar store.
2) System integration: Back-end systems such as inventory management, fulfillment, and customer service are integrated so that customers can check inventory status and track order status in real time across all channels. For example, many retailers, including Walmart, offer a service that allows customers to view products on their website and pick them up in-store.
3) Cross-channel shopping continuity: This is when a customer can start shopping on one channel and finish on another. For example, Target allows customers to add items to their cart in the mobile app and later check out on the website or in-store. It offers a variety of options, including Buy Online, Pick Up In Store (BOPIS), Buy Online, Return In Store (BORIS), and same-day delivery. These flexible fulfillment options make it easy for customers, which is why Best Buy is performing so well in e-commerce.
4) Personalized services: Leverage customer data collected from various channels to deliver personalized recommendations, promotions, and communications. Just as Amazon makes personalized recommendations based on a customer's past purchases and browsing history, these traditional retailers will be able to analyze their customers' online and offline shopping behavior to make personalized recommendations.
5) Consistent customer support: Provide consistent and accessible customer support across all channels. This includes live chat on websites, quick responses on social media, and customer service desks in brick-and-mortar stores.
6) Data-driven insights: Analyze data collected across all channels to understand customer behavior and preferences to optimize marketing strategies, inventory management, and customer experience. For example, Costco uses data analytics to quickly restock popular products and offer personalized promotions to customers.

These omnichannel strategies enable large retailers to improve customer satisfaction, strengthen loyalty, and increase sales. The concept goes beyond simply growing online sales and extends the positive shopping experience of existing in-store customers online.

This article provides an overview of strategies that integrate offline and online channels to enhance the consumer experience, which in turn drives customer loyalty and increases sales. We hope that this review of the e-commerce and omnichannel strategies of the US big-box retailers has provided sellers with important insights for expanding their US business. # References [1] Revenue of the e-commerce industry in the U.S. 2019-2029, Statista
https://www.statista.com/statistics/272391/us-retail-e-commerce-sales-forecast
[2] Top 100 Retailers 2023 List, National Retail Federation
https://nrf.com/research-insights/top-retailers/top-100-retailers/top-100-retailers-2023-list
[3] E-Commerce - Mobile has become the leading channel, Statista
https://www.statista.com/markets/413/topic/544/key-figures-of-e-commerce/#statistic2
[4] E-commerce in the United States - statistics & facts, Statista
https://www.statista.com/topics/2443/us-ecommerce/
[5] What are the Most Popular Devices for Online Shopping 2023? Smartphones, Laptops or Tablets?, ECDB
https://ecommercedb.com/insights/most-popular-devices-for-online-shopping/2933
[6] Walmart Official Investor Relations https://stock.walmart.com/home/default.aspx
[7] Costco Investor Relations https://investor.costco.com/overview/default.aspx
[8] Target Investor Relations https://corporate.target.com/investors
[9] Home Depot Investor Relations https://ir.homedepot.com/
[10] Best Buy Investor Relations https://investors.bestbuy.com/
[11] Kroger Investor Relations https://ir.kroger.com/overview/default.aspx
[12] TJ Maxx Investor Relations https://tjmaxx.tjx.com/store/jump/topic/investor-relations/2400088
[13] Target Losing Billions in Value Is Unlikely About Boycotts, Newsweek
https://www.newsweek.com/target-stock-price-boycott-lost-billion-value-lgbtq-pride-1803770
[14] Best Buy's e-commerce revenue in the United States 2018 to 2024, Statista
https://www.statista.com/statistics/1124208/online-revenue-best-buy/
[15] WALMART ONLINE SALES (2019–2023), OBERLO
https://www.oberlo.com/statistics/walmart-online-sales
[16] Kroger's e-commerce net sales value, Statista
https://www.statista.com/statistics/1202056/kroger-e-commerce-net-sales
[17] Kroger's 4 pillars of ecommerce growth, The Current
https://thecurrent.media/kroger-ecommerce
[18] Off-Price Retailer TJX is Unstoppable, The Robin Report
https://therobinreport.com/off-price-retailer-tjx-is-unstoppable/

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