Walmart just launched a price war against Amazon!
It cut the price of 10 hot books to $10 apiece.
Amazon immediately matched.
So Walmart cut the price to $9.
This is going to be good!…
Miguel Bustillo and Jeffrey Trachtenberg, WSJ: Wal-Mart Stores Inc. launched a brash price war against Amazon.com Inc. on Thursday, saying it would sell 10 hotly anticipated new books for just $10 apiece through its online site, Walmart.com.
That was just the beginning.
Hours later, Amazon matched the $10 price, squaring off in a battle for low-price and e-commerce leadership heading into the crucial holiday shopping season. Wal-Mart soon fired back with a promise to drop its prices to $9 by Friday morning.
Wal-Mart said the splashy move to discount pre-orders of popular books such as Stephen King’s “Under the Dome” and Sarah Palin’s “Going Rogue” was part of a larger strategy to establish Walmart.com as the biggest and cheapest online retailer.
Who’s going to win?
In our opinion, Amazon.
Because it’s better at ecommerce. And because it can’t afford to lose.
This is Amazon’s core business. It’s a sideline for Walmart. Both companies can afford loss leaders, and Amazon will do what it has to to remain competitive in high-profile products. Meanwhile, its superior ecommerce distribution infrastructure, customer service, and web site should allow it to maintain its position as the premium ecommerce destination.
If Walmart’s really serious about going to war, though, it could be painful for Amazon for a while.
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