After its wild growth, how much market share has Walmart taken away from Amazon?

In the past year, Walmart has captured a lot of market share in the US e-commerce market, but it does not seem that these shares were taken from Amazon.

Since Walmart increased its investment in e-commerce in 2022, its online revenue in the United States has grown by 12% , nearly double the 6.5% growth in national online retail estimated by the U.S. Census Bureau .

Walmart's numbers also look impressive when compared with online retail sales reported by Amazon, which actually saw a decline in online sales in 2022 in constant currency.

However, these data alone do not tell the full story of the U.S. e-commerce market. Amazon investors are concerned that the rise of Walmart could shake Amazon's market dominance, so they want to see more information.

In fact, the 12% growth reported by Walmart covers its entire e-commerce business: official sales, third-party seller services, and advertising revenue. Therefore, this figure should be compared with Amazon's overall e-commerce revenue.

While Amazon’s online sales stagnated last year, its third-party seller services and advertising businesses continued to grow. In fact, Amazon’s e-commerce-related sales in North America grew 14% in constant currency.

In addition, Walmart also said that it generated more than $80 billion in revenue from e-commerce worldwide last year , an increase of more than 9% from $73.2 billion in the previous year.

This is indeed faster than Amazon's global e-commerce related revenue growth of less than 6%, indicating that Walmart has made good progress in the international e-commerce market.

As Walmart continues to increase its investment in e-commerce, there are several areas that may be worth paying attention to.

First up is retail media advertising: Walmart, which broke out advertising revenue for the first time during its fourth-quarter earnings call, earned $2.7 billion from advertising last year, though that pales in comparison to Amazon's $37.7 billion in ad revenue.

Secondly, Walmart's full-year 2023 guidance is only 2.5% to 3%, with comparable sales increasing by only 2% to 2.5%. In other words, Walmart expects growth to slow significantly, which may further widen the gap with Amazon.

Finally, Walmart recently seems to have set its sights on markets other than North America, hoping to expand its e-commerce business without competing head-on with Amazon.

Therefore, Amazon's leading position in North American e-commerce will still be difficult to shake in the short term, but sellers can still take advantage of Walmart's e-commerce development period to make early arrangements, as the competition on its platform is much smaller than that on Amazon.

Amazon

Walmart