Only a few months into a relationship with Linux-powered PCs, Wal-Mart is pulling the plug on the products.
The retail giant has sold out its stock of Linux-driven and price-friendly Everex Green gPC systems, and says it won’t be restocking its shelves with replacements — although several models can be found on Walmart.com.
So, why did the Linux-powered product fail at the self-proclaimed “low-price leader?”
Not an In-Store Customer Choice
Wal-Mart doesn’t have any definitive answers. “We definitely understand some people like this system, and that it’s a great alternative, and that’s why we still have it online,” Wal-Mart spokesperson Melissa O’Brien told LinuxInsider. “We felt there was certainly a market for their products, but we did not see the products’ popularity go over well in the fall in our stores. Our stores’ customers vote with their purchase decisions. While it does seem to be a product that consumers may be looking for online, our customers in the stores didn’t seem that interested in the product.”
Analysts pointed to the bottom line as the reason the in-store Linux experiment failed.
“They say they sold the inventory, but clearly not very fast, because they didn’t reorder,” Roger Kay, principal analyst at Endpoint Technologies, told LinuxInsider.
The product was aimed at the right audience, he said. “Theoretically, they’re targeting neophytes — unsophisticated users.”
Those are the customers who are shopping at the lower end of the product spectrum, Kay noted.”They wanted a low price point.”
No Monitor, No Purchase?
However, price-conscious consumers looking for an entry-level system want an entire system, Kay said, noting that the low-priced Linux-powered unit was not sold with a monitor.
“If you go in the store and need a monitor, they’ll sell you one, but when they put their circular in the newspaper, they put the [price in large print],” he commented, adding that the same ad mentions — in much smaller print — that monitors were sold separately.
“They’re trying to generate traffic,” Kay pointed out. “Obviously, it wasn’t working well because they didn’t reorder.”
The decision not to bundle monitors with the systems was Everex’s, not the retailer’s, O’Brien. Wal-Mart tried selling the Green gPCs in about 600 stores across the U.S. beginning in October, although the product was available before that on the company’s Web site.
“If it sells, I’m sure Wal-Mart might keep it,” Burton Group analyst Anne Thomas Manes told LinuxInsider. “My other guess is Wal-Mart’s not making enough profit on it.”
System Outside the Mainstream?
That some consumers might not be familiar with Linux systems could have played a role in the failure of the experiment, Manes said.
“They were targeting the general population with this, and you’re looking for something really cheap that will get you on the Internet,” she added. “It’s a Linux machine that will run a lot of the open source technologies out there, but it’s possible the people buying them are not the most sophisticated users.
“Linux is not quite as intuitive as Windows or Mac. Even if they’ve done a really nice job of building the user interface, my guess is people look at it and don’t know what it is, so they run away,” Manes noted.
Kay agreed. “One of the promises is Linux could be a simpler experience for the end user, but I think the reality is it’s not. Windows is big and complicated, but there are still a lot of people familiar with it, whereas there aren’t a lot of people familiar with Linux. It’s still not mainstream, and I think that’s what [Wal-Mart’s test run end] really says.”