Wal-Mart and Amazon fight for the future

There have been several articles written lately about the price war between Amazon and Wal-Mart. It seems that the two companies are in a brutal contest to see who has lowest prices and ultimately who will rule the future of retail.

Here is how The New York Times puts it: “In what is emerging as one of the main story lines of the 2009 post-recession shopping season, the two heavyweight retailers are waging an online price war that is spreading through product areas like books, movies, toys and electronics.”

Why is it important; because, Wal-Mart sees Amazon as its biggest threat. Here is what the article quotes analyst, Fiona Dias, as saying: “It’s not about the prices of books and movies anymore. There is a bigger battle being fought...The price-sniping by Wal-Mart is part of a greater strategic plan. They are just not going to cede their business to Amazon.”

My opinion is that Amazon should avoid this fight and focus on keeping a lead in what it does best, marketing to consumers who want to shop on line. That population is going to continue to grow as more and more tech savvy (or just tech comfortable) kids grow into adults. That means the future belongs to Amazon as long as they stick to their knitting: Producing a great on line shopping experience.

No one wins in a price war with Wal-Mart; not even Amazon. Stick to what you do best Amazon and the future is yours.