Advocacy Articles

Walmart.com …the Test!
By Mark Palmore

When I first learned about the Walmart.com Web site jumping into the college textbook business, my first reaction was "Here we go again." Though Wal-Mart knows how to move merchandise at reasonable prices and still be profitable, what do they know about college textbooks? After conducting a test by ordering three titles from their site, I now know that they don't know anything about the college textbook business, and that is what scares me.

My concern is what will happen when they know just enough to be dangerous. Walmart.com sells thousands of different items, and as we know from their venture into college textbooks, they sell items that are certainly not available in their stores. Why are they selling college textbooks? Is it to lock up college students as lifelong walmart.com customers? They wish, but more likely it is to persuade college students to buy other items from their Web site such as dorm and school supplies, etc. Or, is it Wal-Mart's goal to generate more business from the parents of college students? Maybe. But what puzzles me is that I have seen almost no press coverage or advertising promoting that Walmart.com is selling textbooks. I contend that Wal-Mart is not sure where this is going to lead. But, by not over publicizing that they are in the college textbook business, if it fails they will not have to eat much crow.

Oh well, enough of my old sayings. Let's look at the results of a test we performed August 17- 28, 2001.

Placing of the order on Walmart.com
On Friday, August 17, I placed an order on the Walmart.com Web site for three new textbooks, as they do not list availability of any used books. The order consisted of a title from each of the three major higher-education publishers: Pearson, Thomson, and McGraw-Hill. It took me a while on the site to find major textbook titles that were available. I was not even looking for any specific titles, though I started out that way and finally just settled for any available title from the three companies because many of the books I looked at were listed as "Out of Stock." All three of the books had the notation that the "book will ship within 3-5 days of order." Approximate time on the Web site placing the order: 20 minutes.

Within minutes, I received an "Order Confirmation" e-mail with my order number, listing of each title and the other charges (tax and shipping/handling).

Receipt of the order
The books arrived in two separate shipments. Both shipments had a return address of Bentonville, Arkansas, where Wal-Mart is located.

The Pearson title arrived at my office on August 23, SIX days after the order was placed.

The Thomson and McGraw-Hill titles arrived together on August 27, TEN days after the order was placed. Both of these titles were shrink-wrapped with either a Study Guide or Internet booklet. There was no mention of those items on the Web site. In both cases the original ISBN had been changed to reflect the ISBN for the package. For those of you who know anything about doing business with Wal-Mart, the changing of product numbers carries a stiff penalty. The publishers certainly should beware.

Return of the books to local Wal-Mart stores
On Tuesday, August 28, Connect2One Executive Director Dick Welsh and I took the three books ordered from Walmart.com and attempted to return them to two separate local Wal-Mart stores. The Pearson title was returned to Wal-Mart store #2172 in Springdale, Ohio. This was a very interesting experience. The staff at Wal-Mart was very courteous, but at first they simply wanted us to go away, stating that we would have to return the book to Walmart.com. I pointed out to the individual that on the receipt, it gives the instructions on how to return the book to a Wal-Mart store. She then called a manager, who knew no more than the person at the returns desk. They then called another store employee who was bound and determined for us to leave as satisfied customers, which we did after 45 minutes. By the way, they never really figured it out at this store; they simply returned the money as if I had arrived with no receipt by overriding their POS system. Obviously, the staff at that store was not properly trained to handle returns from Walmart.com.

The McGraw-Hill and Thomson titles were returned to Wal-Mart store #1441 in Mason, Ohio. This was an entirely different experience. The staff at this store was well trained to accept Walmart.com returns, and we were in and out of there in five minutes.

In both cases, my credit card was credited for the cost of the books and tax, not for the cost of shipping.

Price of the Books, Tax, Shipping…Compared to Net Price

WOW, as you can see, the pricing to the customer is BELOW publisher net price! My tax and shipping charges totaled $27.40. You can make a final comparison with your store's pricing by adding in the appropriate mark-up and taxes.

My Conclusions
Wal-Mart is using textbooks to attract the attention of college students and their parents to the Walmart.com Web site. I seriously doubt they are receiving any "special" pricing from the publishers. This is most likely a combination of Wal-Mart not knowing how to price the books and their desire to use textbooks as a loss leader to take over market share, much the same as they do diapers, detergent and soft drinks. As we all know, that is their company history, and they have been tremendously successful.

Finally, as I stated earlier Wal-Mart has no idea how the college bookstore business/buying and selling of textbooks works, but what really scares me is that unlike their dot com predecessors, they'll learn!