Catching up with Amazon! Walmart adds more than 1,000 sellers in a single week

Catching up with Amazon! Walmart adds more than 1,000 sellers in a single week

Due to its slow start and late entry, Walmart's e-commerce business performance is not very impressive, and it is at a disadvantage compared to Amazon. However, the financial report points out that Walmart's e-commerce business is developing steadily, and data in all aspects, such as traffic, sellers, and buyers, have increased compared with the previous period.

 

Q3 revenue exceeded expectations, and Walmart's e-commerce grew steadily

 

Last week , Walmart released its third-quarter 2022 financial results , noting that revenue for the quarter reached US $152.81 billion, an increase of 8.7% year-on-year, compared with expectations of US$147.75 billion , due to strong grocery demand , coupled with the US back-to-school season and online promotions .

 

 

After the financial report was released, Walmart's stock price rose sharply, with an increase of nearly 5%.

 

Although its revenue exceeded expectations , its operating profit in the third quarter fell 53.5% year-on-year to US$2.7 billion , and its net loss reached US$1.77 billion, compared with a net profit of US$3.13 billion in the same period last year . It can be seen that Walmart was inevitably affected by the sluggish market.

 

Walmart Chief Financial Officer John David Rainey said high inflation has stretched Americans' wallets and consumers are looking for sales more than ever , while also spending less on apparel and home furnishings.

 

However , Walmart's overstock problem eased during the quarter , with inventory increasing by only 13 %, down from 26% in the second quarter and 32% in the first quarter . Apparel and electronics saw the largest inventory declines .

 

The most noteworthy thing in this financial report is the performance of its e-commerce business segment.

 

The financial report shows that in the third quarter, Walmart's US e-commerce sales increased by 16% year-on-year, and the cumulative growth in two years was 24%.

 

 

The data did not disclose other details about the growth of the e-commerce sector, but Walmart has made no secret of its efforts to expand into the online market.

 

Walmart is catching up with Amazon in the e-commerce market

 

When talking about Walmart, one cannot help but mention its competition with Amazon .

 

This year is the ninth consecutive year that Walmart has been ranked first in the Fortune Global 500, while Amazon's ranking has jumped to second place this year, second only to Walmart. Some analysts said that at Amazon's current business growth rate, it may surpass Walmart within two years.

 

In the physical retail sector, Walmart has a decisive advantage, but in the e-commerce sector, it started late and the market dividends have almost been divided up by Amazon and others, so it is still at a disadvantage.

 

Statista data shows that Amazon accounts for 37.8% of the US e-commerce market, while Walmart only accounts for 6.3% .

 

Jungle Scout 's latest survey shows that when shopping online, 73% of Americans choose Amazon, while only 43% choose Walmart .

 

However, Walmart did not give up and is still working hard in many aspects to occupy more e-commerce market share.

 

For example, in the membership development sector, Walmart reduced the cost of Walmart+ membership by half and held several membership promotions to stimulate the growth and consumption of new members.

 

Jason, Chief Commercial Officer, Publicis   Goldberg said Walmart and Amazon compete for customers on the fence, and when Walmart lowers prices, Amazon Prime customer churn could be higher.

 

During the third-quarter earnings call, Walmart CEO Doug McMillon also said that Walmart.com's growth is "improving" and that its Walmart+ membership subscription program has an estimated 16 million members, with the total number of Plus members increasing by about 9% over last year and penetration continuing to climb.

 

At the same time, the financial report shows that membership revenue in the quarter increased by 8% and the number of members reached a historical high .

 

However, in Jungle Scout 's latest survey , 57% of respondents have an Amazon Prime membership, but only 31% have Walmart Plus.

 

 

In terms of sellers, the e-commerce businesses of both companies are currently heavily dependent on third-party sellers, of which Amazon accounts for 82% and Walmart accounts for nearly 79%. Data shows that there are currently about 6.3 million third-party sellers on Amazon , while Walmart has only 150,000 . However, Marketplace Pulse shows that nearly 1,000 new sellers join the Walmart market every week, which is 4 times higher than before and almost the same speed as the new sellers in Amazon's US market .

 

In terms of product prices, Walmart has an advantage . Perhaps due to inventory and other factors, Walmart's low-price promotions are more frequent than Amazon's. In addition, Walmart's user stickiness is temporarily ahead of Amazon.

 

The competition between Walmart and Amazon is intensifying, spreading from offline to online. According to the current first-half financial report, although Amazon 's e-commerce sales ( $50.9 billion vs. $19.2 billion) and subscription sales ($8.7 billion vs. $1.5 billion) are still far ahead of Walmart , the growth trend is the opposite. It is reported that Amazon's e-commerce sales fell by 4.61%, while Walmart's increased by 11.98% .

 

U.S. retail giants use different promotional methods to start peak season battle

 

Last quarter, the performance of US retail giants was mixed. Amazon and Walmart's revenue exceeded expectations, while Target's revenue plummeted, with net income down 49.1% year-on-year and profits plunging 52%.

 

Regardless of their performance, these giants have lowered their revenue expectations for the fourth quarter. In the sluggish market, how will they achieve even better results in the upcoming holiday sales season?

 

As an important promotional period during the peak sales period, "Black Friday" has always been a node that sellers and retailers must compete for.

 

Mastercard Spending Pulse predicts that this year's Black Friday retail sales in the United States will increase by 15% compared to last year . Last year, US consumers spent $ 10.7 billion on Cyber ​​Monday , and Adobe predicts that this year's spending will increase by 5.1%. ICSC predicts that US consumers will spend $125 billion on Thanksgiving this year , a 10% increase over the same period last year .

 

Recently, American retailer Target announced that it will hold its largest "Black Friday" week promotion ever online and in physical stores from November 20th to 26th.

 

During the event, enjoy the best discounts of up to 50% on electronics, toys, kitchenware, etc.

 

Target offers a "Holiday Price Match Guarantee" that allows free returns on most new, unopened items within 90 days of purchase .

 

Walmart also launched the "90-day free return" strategy during this year's holiday sales season. In addition to "Black Friday", Walmart is now also focusing on "Cyber ​​1". Compared with "Black Friday" with omni-channel promotions, "Cyber ​​1" focuses more on online shopping. Therefore, some media have joked that "Black Friday" is Walmart's day, and "Cyber ​​1" is Amazon's day.

 

However, Walmart recently launched a "Monday Case" campaign to create topics and attract consumers to go to Walmart for online shopping on "Cyber ​​Monday" . In addition , Walmart has been promoting "Black Friday Cyber ​​Monday" on YouTube throughout November .

 

Amazon has already set the specific time for this year's "Black Friday Cyber ​​Monday" promotion, and the discounts are not small, ranging from 20% to 65% depending on the category. In addition, it also announced an extension of the return period, extending the return period to January 31, 2023 for most products purchased between October 11 and December 25 this year .

 

Alleviating revenue pressure and easing inventory pressure may be the biggest expectation of most retailers for the fourth quarter of this year, but it also means that the peak season battle for retailers this year will be more intense.

 

But GO   Banking   The latest survey by Rates shows that Amazon remains the most popular online shopping channel for Americans during this holiday season due to its richer product variety. Nearly half ( 48% ) of Americans choose Amazon as their first choice for online shopping .

 

Compared with other platforms, most sellers still flock to Amazon and have been gearing up for a long time in the hope of achieving positive sales results. Although the dream of a big sales boom during the peak season may not be realized, a small sales peak may still be expected.

Walmart

Amazon

<<:  Revenue exceeded 4 billion in 9 months! Another Amazon seller is about to go public

>>:  Amazon CEO says layoffs will continue until 2023

Recommend

What is Lakala Cross-border Payment? Lakala Cross-border Payment Review, Features

Lakala Cross-border Payment is committed to provid...

Thousands of people on strike at European ports, sellers' goods may be delayed!

As the new peak season approaches, sellers are sp...

What is Fengmaitong? Fengmaitong Review, Features

Fengmaitong is positioned as an intelligent stewar...

Sales dropped 85% as Amazon's new rules hit sellers hard

Amazon’s new coupon rules in the United States ha...

What is Prophet AI? Prophet AI Review, Features

Prophet AI is a brand under Dunhuang, founded in ...

Meiya's hot search word NO.1! Peak season products are booming

The 2023 peak season is here! Entering September ...

What is American Trench? American Trench Review, Features

American Trench is a Philadelphia-based fashion b...

What is Buy a Bargain? Buy a Bargain Review, Features

Buy a Bargain is an APP that focuses on discoveri...

What is CIMC Xiaofeiyu Logistics? CIMC Xiaofeiyu Logistics Review, Features

Dongguan CIMC Xiaofeiyu Logistics Technology Co.,...