Germany is different
Once again, there is proof that Germany is different, this time on the positive side, which is often forgotten. Wal-Mart seems to have made a loss of a hundred million or more last year. Numbers aren’t being published but this is what Spiegel writes. They are also closing stores. People of Wal-Mart, you might be the master of cheap in the US, but we are the masters of cheap period! With good quality to boot!
I mean Wal-Mart came here with their strategy of huge mega stores with cheap stuff, and forgot that we have Aldi (and Lidl) and there is a reason the Aldi brothers are guessed to be among the richest in the world. Aldi is built from the ground up to be able to offer things cheaply. They have for example a lot less different products than a normal super market, hence buy in bigger volume hence get cheaper prices. Wal-Mart wasn’t able to beat the prices or the brand. We actually like real quality too, just that we take it for cheap. MediaMarkt and Saturn are the two biggest electronics shops in Germany and they belong to the same mother company and hence do their buying together. That’s buying power that dwarfs that of Wal-Mart.
Dell actually has a similar problem for all I know. They are gaining in the corporate sector but cheap PCs for the average Joe are around the corner here. I am telling people that for a Laptop, if they don’t take an Apple, they should take Dell, because there a real brand behind it helps. But for standard PCs, you can just as well go to Aldi, which will guy a few hundred thousand Medion PCs and sell them cheap every once in a while.
It again proves that you need a really different value proposition in your target market to succeed and Wal-Mart and partly Dell, just don’t cut it. Dell could be gaining at the moment though, so don’t take my word for granted. I just know Dell exchanged their German head several times already in the past.