Amazon and Walmart have been heading towards a collision course, making steady strides into each other's territory over the past couple of years, heating up the fight for global retail dominance. While Amazon's 13.4B acquisition of Whole Foods helps it make headway into brick and mortar retail, Walmart's revamped online user experience has resulted in a 60% increase in online sales in 2017. This combined with Walmart's acquisitions of e-commerce sites like Jet.com, Shoebuy, Modcloth etc, and its subsequent partnership with Google's voice platform (pitting it against Amazon's Alexa) are nothing short of an arm's race to beef up their digital artillery against each other.

A Wharton case study suggests that "In an omni-channel matchup, Amazon has the advantage over Walmart, says David Bell, a Wharton marketing professor. “From my experience, companies that start in the digital world and slowly and surely add offline have been more successful than companies that started in the offline world and added digital.” He says it’s easier, for example, for eyeglass e-tailer Warby Parker to open an offline store than it is for an optical shop to add a fully integrated digital experience. Since Amazon has “all this digital DNA and digital knowledge, they will presumably create the offline experience relevant to 2017 and not 1967,” Bell adds. “That’s the big difference.”"

Even so and contrary to what one might expect, Walmart has already developed a thriving online fresh groceries order and delivery business in China - a model that its US operations could definitely derive value and learn from. In China the fresh food retail market, which amounts to 324m tons in sales annually is already 2% penetrated by Walmart, wheres that in the US that number is less than 46m tons, and is only 1% captured.

According to a Bloomberg report :"Walmart (China) has created a network of chilled mini-warehouses, used artificial intelligence to tailor inventories and employed an army of crowdsourced deliverymen to rush meat, fruits and vegetables to customer's doorsteps within an hour.

At the heart of Wal-Mart’s operation are what it calls “dark stores,” or convenience-store-size areas in its main locations that stock 1,500 different products such as bananas, pork ribs, frozen dumplings, and fresh chicken feet. Workers grab printouts of the online orders, zip through the aisles placing items in a bag, and exit the other side, where they hit a button summoning a delivery driver. The drivers are independent contractors, such as Uber drivers, with cellphones and scooters. The time from picking up the order printout to hitting that button can’t exceed 10 minutes, or else the one-hour delivery is in peril."

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