Walmart vs Amazon

Walmart vs Amazon: Latest News From the Battlefield

Julie Stewart • December 10, 2019


In the rapidly heating battle between Walmart vs Amazon (aka Godzilla vs King Kong), Walmart has arisen from a long slumber and is starting to gain the advantage over its longtime rival.




Different companies with different strengths


This article is mainly focused on how the battle between Walmart vs Amazon affects third-party sellers using each platform, but it’s worth noting the different structural and financial advantages each enjoys over the other.


Walmart still the leader for low prices and groceries.

In 2018, LendEDU conducted an analysis comparing 50 identical products across several different consumer categories. They found that Amazon is 10.37% more expensive than Walmart for identical items.

Amazon does offer discounts and incentives, especially for Prime members. However, Walmart has a slight pricing edge over Amazon, providing a variety of rollback discounts, clearance items, incentives for customers for picking up their items in-store, as well as free shipping without a subscription fee.

Walmart still rules when it comes to groceries, which it sells in both Walmart Stores and in its Sams Club membership stores. Its massive distribution network remains far bigger than Amazon’s Whole Foods and Amazon Fresh grocery networks.


Amazon’s diversified revenue base props up its retail operating losses.

Amazon is now a process company more than it is a retailer. Last year, it collected $122 billion from online retail sales, and another $42 billion from its FBA services. Its AWS division, a vast collection of server farms hosting institutional and multinational clients across the globe, accounted for $26 billion. $14 billion more came from subscription services like Amazon Prime or Kindle Unlimited, and $17 billion from sales at its brick-and-mortar stores.

About half of Amazon’s revenues and a much higher percentage of profits are coming from activities outside their core online retail business. These other profit streams enable Amazon to keep investing more and more into higher risk retail initiatives, which in turn keeps pre-tax profits so low that effectively, the company pays no U.S. income taxes.


In 2018, Amazon reported a federal income tax rebate of $129 million. That works out to a tax rate of -1 percent.


However–Prime membership is dropping.

Prime members are the most likely to make purchases on Amazon, due to the free shipping on Prime-sponsored products, so this could mean a depressing effect on total sales.




Walmart’s E-commerce surge from 0 to 60 since 2016


It’s been 10 years since Walmart first launched its online Marketplace.

For seven years after the launch, the Walmart marketplace languished as the company struggled with being relevant for online shoppers. Things started to change in 2016 when the company acquired Overnight, the Walmart Marketplace grew to nearly 8,000 sellers after starting the year with less than 500.

In January 2016, Walmart’s online offerings included only 5 million products. After several other acquisitions (see below), they are on target to be offering 50 million by the end of this year.

As of Q3 2019, the Walmart Marketplace had grown to over 28,000 sellers, with 45 million items for sale.

Walmart may be behind Amazon in terms of online performance, but the store has also been rapidly growing its online customer base. Between early 2017 and early 2019, Walmart has seen 207% growth in its E-commerce buyer base.


Walmart’s growth-through-acquisition strategy paid off.

In just over a year’s time starting in late 2016, WalMart purchased, a relatively new online marketplace. This was followed by acquisitions of Bonobos, a men’s clothing company, ShoeBuy, Moosejaw (outdoor sporting apparel), and ModCloth, a clothing company aimed at Millennials.

Walmart’s strategy of growth by acquisition has enabled the company to surge from 0 to 60 in under four years.




How the Walmart vs Amazon competition is shaping up today


Unlike Amazon, Walmart is unlikely to offer a line of its own branded products in competition with the vendors it’s working with. But it’s going head to head with Amazon in other ways.

Bloomberg recently reported that, in response to Amazon’s Prime Day sales, Walmart introduced a program to temporarily lower the price consumers pay for some items on its Marketplace. Merchants selling on the site are paid the same amount that was listed before the cuts, with Walmart subsidizing the difference. Walmart has also grown its offerings for free shipping–and the buyer doesn’t have to pay a membership fee to enjoy the benefit.


Walmart is starting to gain the edge.

A First Insight study in 2019 confirmed that U.S. consumers, when asked whether they prefer to shop at Walmart – whether in-store or online – versus Amazon, 55 percent of consumers now prefer Walmart, compared with 47 percent a year ago.




What’s a third-party seller to do?


All the heat from the Walmart vs Amazon battle has made it even more difficult for third-party online sellers to stand out on these major marketplaces–and they’re facing competition from the marketplaces themselves as well.

As Amazon and Walmart begin to sell many of the same products as third-party sellers, it will become harder for smaller sellers to find listable products that aren’t routinely beat on price by the marketplace owners themselves.

Consider that one of the biggest benefits of owning the world’s largest online marketplace is that you have sales and pricing data on every third-party seller. Amazon is notorious for copying popular products from third-party sellers and then private labeling them with lower listed prices.

Both Walmart and Amazon are making it harder for retailers to remain profitable as they compete with each other to offer the lowest possible prices on everyday items. And don’t forget the fact that both Walmart and Amazon routinely pressure suppliers and manufacturers to offer their lowest prices — or else they’ll find another company that will.




Diversify your channels for continued profitability.


Sure, Godzilla and King Kong will continue to dominate, but it is not inevitable that they will be the last two standing. There are still plenty of good selling opportunities through other channels and marketplaces. The world of E-commerce is constantly changing, with giants like Facebook, Google and PayPal entering the stream as well as growing competition from smaller marketplaces around the world.

Using a syndicated product feed service is one of the best ways to diversify.


Shoppingfeed is a certified partner of both Walmart Marketplace and Amazon, but we also work with every major online marketplace worldwide. Our service helps brands and online stores to syndicate search-optimized product listings on all of the world’s most powerful marketplaces. It syncs and refines inventory data, perfects your listings, and automates your fulfillment workflows.

Discover 6 Secrets to Amazon Success


Julie Stewart

My mission at Shoppingfeed is explaining how to leverage e-commerce platforms and SaaS technology to e-merchants who just want to run their business and make more money.

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