Wal*Mart Bank?

from the low-tech-banking dept

When the biggest retailer in the world buys the smallest bank in the US, what do you get? Scared if you are a big bank betting your future on on-line banking (hello, Bank One/WingSpanBank.com). Well, WalMart may be going into the banking business. With 3000 “branches” it would qualify as a top 3 banking entity in the US. This shouldn’t make any of us urbane sophisticates even blink, but I wouldn’t doubt there will be an on-line component. Just a word on their on-line history. They were an early entrant into on-line retailing, but their “sell on-line what you’ve got in the store this week” model hasn’t been successful on-line. Along those lines, I saw a good presentation from BCG about them vs Amazon. Both were at parity in 1996 in selling books on-line. But WalMart stuck to selling on-line what they sold in B&M — only the “top moving” books. Now WalMart is lucky to sell a few thousand books a month on-line, so they’ve found out the hard way that availability is cheap to maintain for a purely on-line retailer (especially when you can muscle your inventory holding costs back in your supply chain), but it is very hard to maintain when you tie your on-line offerings to your B&M offerings. Reboot, WalMart.

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