Amazon vs Walmart: The Price of Being Late to the Game. Amazon has emerged victorious in the battle for e-commerce dominance, with Walmart lagging significantly behind. Despite being twice as large as Amazon in terms of total annual sales, Walmart only has 6.4% of e-commerce sales in the U.S., compared to Amazon's 37.6%. This disparity has resulted in Walmart losing hundreds of billions of dollars annually. Btw, traffic to Amazon.com was 5x higher than to Walmart.com last December, which is a good indicator of popularity of the platform among consumers. One significant reason for this disparity is speed to market and belief in the growth of e-commerce. Jeff Bezos was quick to recognize the potential of e-commerce, while Walmart management was slower to adapt and integrate e-commerce into its retail empire. Another reason is investment in 3P sellers. Amazon has shifted from being a retailer first to becoming more of a marketplace, where third-party sellers represent more than 60% of its retail business. In contrast, Walmart is retail first and marketplace a distant second. While there are many factors at play, these two reasons have played a significant role in Amazon's dominance in the e-commerce market. It's fascinating to see that even though Walmart is the largest retailer in the U.S., Amazon has captured a larger share of the e-commerce market (so far). #amazon #walmart
George Brown
1w
As a shopper, if I go to Walmart, Target etc I Only want what they’re selling, not a 3P. Whereas with Amazon I know it’s a pass through if you will
Ola Parks
5mo
I believe Amazon's prominence in the online retail sector is attributed to its efficient same-day delivery service and an extensive product assortment that spans diverse categories, including clothing, books, and pharmaceuticals. Also, I am glad to see Aldi on the list, as it has recently became one of my fav stores. Somehow they managed to keep the price low while offering an organic product assortment.
Luke Rumley
4mo
Looks like Walmart is doing ok
Entrepreneur, Inventor, & Biz Ops
2wAmazon takes gross advantage of its 3rd party sellers... Pushing most of the costs, problems, and risks upon them, while it enjoys in most cases a 15% profit margin or more. There's a very high turnover in sellers, as dreamers come to the platform, and then sell at a loss. I do agree with the article's points though, that Amazon came to prominence by being first to market, and by encouraging those third party sellers. Although now, a big concern of mine is the total lack of liability of foreign sellers in the US domestic market, most of which are located in China. The foreign sellers benefit by copying designs and then producing them where manufacturing is strong in their country, and then by selling quickly made items that are on average less safe than US made items, all the while bearing little-to-no risk of lawsuit from harm caused in the US. These foreign sellers have a fairly strong competitive advantage in these regards, hence why Amazon is becoming a marketplace with many products of questionable quality. Sometime there may be a day of reckoning for Amazon.