Htoo Wai Lin Aung
No.06
Diploma in Business Management and Administration
Benchmarking
Assignment 2 - Wal-Mart’s benchmarking
Assessor
Tr. May Thiri Khit Oo
Table of Contents
Page
1. Introduction 1
2. What is Benchmarking? 1
3. Types of Benchmarking 1
4. Net Promoter Score (NPS) 2
5. Wal-Mart 2
5.1 Walmart benchmarking for advertising spending 2014-2021 3
5.2. Walmart’s sales and brand growth 4
5.3 Market share of top retail e-commerce companies in the US by 2021 4
5.4 Net Promoter Score of Walmart's e-commerce retailers in Brazil 5
6. Conclusion 5
References
1. Introduction
Today, technology is developing rapidly. Changes in economic conditions and the
removal of trade borders have led to major technological changes. With this change, the
importance of knowledge increases. Companies have devised various ways to survive in the
marketplace and to ensure customer satisfaction. Benchmarking is one of the most innovative
ways to innovate and stay afloat. The organization needs to look outside to support the need for
change and to provide a mechanism for change. Nowadays, access to information, acquiring and
learning is more important than solid data, and benchmarking is an important policy for the
business management and supply chain of the company. This approach allows companies to
identify their strengths and weaknesses. To assess opportunities in the best possible way, it aims
to attract customers and thrive in a competitive environment in a corporate culture.
2. What is Benchmarking?
Benchmarking is defined as the process by which organizations measure products,
services, and processes, and organizations that are known for measuring one or more aspects of
their operations. Benchmarking is a powerful management tool is helps to break through
resistance to change by demonstrating other methods of solving problems than the one currently
used. Benchmarking is the process of improving performance by continuously identifying,
understanding, and adapting outstanding practices and processes found inside and outside an
organization such as company, public organization, university, college and so on (Huffs et
al.,2009).
The benchmarking enables managers to prioritize best practices to prioritize customer
empowerment opportunities in relation to customer expectations and leapfrog the conventional
change cycle. It helps managers understand the most precise and efficient way to perform a task.
It helps managers to learn how the company is actually cost-effective and how to increase its cost
savings.
3. Types of Benchmarking
There are two main types of benchmarking. They are:
• Internal benchmarking: Compare practices and capabilities between organizations,
individuals or groups
• External benchmarking: Comparing organizational capacity to industrial generations
and industries.
In this broad category, there are three types of benchmarking. They are:
• Process Benchmarking: This type of benchmarking helps better to
understand how the business compares to others in the industry. By looking at other
1
companies in the industry. We can streamline our processes to make them more efficient
and cost effective.
• Strategic Benchmarking: Strategic benchmarking is similar to process
benchmarking. All of this is to enhance the components of our company by looking at
others in the industry. Strategic benchmarking is related to the strategy of creating a more
competitive strategy in our field.
• Performance Benchmarking: This includes data collection and comparison.
Performance benchmarking is often the first step in identifying performance gaps
between organizations.
4. Net Promoter Score (NPS)
The Net Promoter Score is a metric of the customers' loyalty to their family, as well as
their friend, and colleagues. It measure customers' wishes to give friends or colleagues. NPS is
closely related to the growth of a company and is easy to interpret. The net promoter score is a
number from -100 to 100 calculated by subtracting the percentage of Detractors customers from
the percentage of Promoter customers.
5. Wal-Mart
Walmart specializes in hypermarkets, an American multinational retail corporation
operating as a chain of discount stores and grocery stores. Wal-Mart was founded in 1962 by
Sam Walton in Rogers, Arkansas and merged on October 31, 1969. It's run on the foundation of
customer service at "Lowest prices anytime, anywhere". They focus on making a difference in
the lives of their customers and helping them and communities save money and live better. In
January 3, 2017, Walmart has 10,566 stores and clubs in 24 countries, with a total of 48 banners.
The company operates in the United States and Canada under the name Walmart.
2
Walmart is the world's largest revenue company according to the 2020 Fortune Global
500 list and the world's largest private employer with 2.2 million employees. Walmart is one of
the world's most valuable companies by market value and the largest retailer of goods in the US.
In 2019, 65% of Walmart's US $ 510.329 billion in sales came from its US operations.
5.1 Walmart benchmarking for advertising spending 2014-2021
Walmart has raised $ 2.5 billion for advertising. The dollars were invested in the 2014
and 2015 fiscal years. Then, starting in 2015, they gradually increased their investment in
advertising from $ 2.5 billion. That raises $ 3.7 billion, the highest investment in 2020, from the
increase in advertising spending. Then, due to the global financial crisis, investment in
advertising was reduced in 2021. So Walmart has invested $ 3.2 billion in advertising during its
fiscal year, which ends in January 2021. That's $ 500 million less than the company spent last
year.
3
5.2. Walmart’s sales and brand growth
The brand Walmart includes discount stores, supercenters, neighborhood markets and
Sam’s Club warehouse membership clubs and operates through the business segments Walmart
U.S., Walmart International, and Sam's Club. The multinational company, which operates retail,
wholesale and online products, saw its global sales increase by nearly $ 35 billion from 2020 to
2021. Walmart has a brand value of $ 45 million by 2020, referring to the monetary value of a
brand. This means that retail sales are among the top five most valuable brands in the world,
behind major companies such as Amazon, Alibaba and Home Depot. At the same time, Walmart
topped global retail sales in 2019 with sales of US $ 517 billion, surpassing 40 other companies
in the industry.
5.3 Market share of top retail e-commerce companies in the US by 2021
Until October 2021, Amazon now owns 41% of the US e-commerce market and has
become the nation's top online retailer. Second place went to retailer Walmart's e-commerce site
with 6.6 percent market share. Today, Walmart ecommerce is developing its technology and
strategy and will be able to gain more market share in the future.
4
5.4 Net Promoter Score of Walmart's e-commerce retailers in Brazil
In 2017, Walmart had a net promote score of 62.1 points, up from 52.7 last year in Brazil.
In 2019, OLX ranked 72.51 on the highest net promotion (NPS) among e-commerce retailers in
Brazil. In the online marketplace, sportswear retailer Netshoes followed with 68.99 and Mercado
Livre with 63.16.
6. Conclusion
Walmart is expanding as a retailer through other industries. Each year, Walmart finds
new ways to grow and attract new customers but, at the same time, more claims are made against
the retailer by the unions and other businesses. Walmart has been in operation for over fifty-four
years. Walmart offers a variety of products, services, the employees, and the organization and
their sales and prices. Sam Walton the founder of Walmart said "If we work together, we’ll
lower the cost of living for everyone...we’ll give the world an opportunity to see what it’s like to
save and have a better life”. In addition, Wal-Mart is committed to customer satisfaction.
Emphasis is placed on a number of issues, including the disciplined expansion into new
geographical markets and the acquisition of foreign market acquisitions.
References
[1]. [Link]
[2]. [Link]
[3]. [Link]
[4]. [Link]
[5]. [Link]
[6]. [Link]
[7]. [Link]