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article imageOp-Ed: Why Walmart decided not to sell Kindle devices

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By Ken Hanly     Sep 21, 2012 in Business
Bentonville - Walmart has decided that it will no longer sell Kindle devices beyond present commitments to do so. Walmart claims the move is simply part of its marketing strategy but many think that the decision is related to concerns about competition from Amazon.
Just five years ago Walmart, the largest retail chain on the globe, did not need to worry much about the world's largest online mall, Amazon.com. Only around one quarter of Walmart customers also shopped at Amazon.
However, half of Walmart customers now say they shop at Amazon as well. Amazon is emerging as a big competitor as online purchases increase. Walmart realizes what is happening and is increasing its own online presence and e-commerce.
Amazon is butting in on traditional Walmart merchandise from diapers to vacuum cleaner bags. In its latest fiscal year Amazon revenue grew 41% while Walmart grew 8%.
It is not surprising that given this situation Walmart should refuse to help its competitor by selling Kindle devices from Amazon. Every new Kindle Fire owner is at least potentially another Amazon.com shopper.
When a customer buys a Kindle Fire they often decide that the best thing to do with the device is to watch movies and TV episodes. After viewing a few episodes or movies costing a few dollars each it dawns upon them that they could join Kindle Prime for just $79 dollars a year or around $7 dollars a month. As the owner of the Kindle Fire navigates content there are constant reminders that if they are members of Amazon Prime they will have access to thousands of free TV shows and movies as well as 180,00 e-books.
No doubt many Kindle Fire owners will become Prime members. One of the benefits of being a Prime member is free two-day shipping from Amazon. For many it will be good bye Walmart, hello Amazon.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
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