The Battle for Online Supremacy: Walmart’s Efforts to Close the Gap with Amazon

Walmart, the retail giant, is making significant strides in its online marketplace to compete with its arch-nemesis, Amazon. With an ambition to enhance online sales and narrow the wide gap, Walmart held its inaugural Walmart Marketplace Seller Summit. The event, attended by more than 1,500 businesses selling various products on Walmart’s website, aims to attract and retain sellers through innovative strategies and initiatives. In this article, we will delve into Walmart’s efforts to bolster its third-party marketplace as it strives to outshine Amazon in the e-commerce realm.

Walmart has announced new measures aimed at expanding its marketplace and providing greater visibility to sellers. Starting next year, the retailer will expand its marketplace beyond North America and make its presence felt in Chile. Furthermore, Walmart will increase the number of brand shops on its website, enabling sellers to create engaging digital storefronts to showcase their products. These eye-catching storefronts will captivate customers and potentially boost sales for sellers.

To make the selling experience more seamless, Walmart is introducing a new option for sellers to pay the retailer for fulfilling online orders of larger items or items that come in multiple boxes. Canoes and patio sets are prime examples of these bulkier items. Additionally, Walmart is granting sellers with a physical store the opportunity to utilize the retailer’s technology for curbside pickups or deliveries through their network of drivers. These enhancements aim to provide sellers with better fulfillment services, leading to improved customer satisfaction.

Walmart’s focus on its third-party marketplace is driven by its desire to increase e-commerce sales and amplify profits. To achieve these goals, the retailer is investing in automation in its warehouses and stores. This automation streamlines operations, ensuring efficiency and accuracy in fulfilling customer orders. Moreover, Walmart has ventured into lucrative areas outside of traditional retail, such as advertising, last-mile delivery, and fulfillment services. These diversifications expand Walmart’s revenue streams, making it a more formidable competitor in the e-commerce landscape.

Manish Joneja, Senior Vice President of Walmart Marketplace and Walmart Fulfillment Services, describes the marketplace as an “endless aisle” where sellers of all sizes can offer customers a vast selection of items. By collaborating with third-party sellers, Walmart enriches its product offerings and caters to diverse customer needs. This synergy benefits both Walmart and the seller, who share a portion of the marketplace profits. Through this collaborative approach, Walmart aims to create a seamless shopping experience for its customers.

Walmart has strategically hired talent from its rival, Amazon, to bolster its marketplace business. Manish Joneja and Jare’ Buckley-Cox, both Amazon veterans, now occupy senior leadership positions at Walmart. Leveraging their expertise, Walmart aims to tap into the success of Amazon’s marketplace model and apply it to its own platform. By assembling a team of professionals with extensive knowledge in e-commerce, Walmart is positioning itself for substantial growth in the online marketplace arena.

Despite its significant progress, Walmart still has a long way to go in challenging Amazon’s dominance. Walmart’s online sales in comparison to Amazon’s are merely a fraction, with last year’s figures indicating that Walmart’s online sales accounted for less than one-fifth of Amazon’s. Furthermore, Insider Intelligence estimates that Amazon captures almost 38% of e-commerce sales in the U.S., while Walmart trails behind with a market share of approximately 7%. Walmart’s marketplace, though successful, pales in comparison to Amazon’s extensive global presence, operating in 22 countries compared to Walmart’s operations in the U.S., Canada, and Mexico.

Despite the uphill battle, Walmart has demonstrated positive traction in the online marketplace arena. In the last two quarters, Walmart’s U.S. business has achieved double-digit growth in online sales while its competitors, such as Target, Best Buy, and Macy’s, experienced declines. E-commerce sales for Walmart U.S. surged by 27% in the fiscal first quarter and 24% in the fiscal second quarter compared to the same period last year. Furthermore, the number of customers purchasing items on Walmart’s marketplace increased by 14% in the fiscal second quarter. This growth is particularly notable in the home and apparel categories, indicating successful penetration into various market segments.

As Walmart relentlessly pursues its goal of narrowing the gap with Amazon, it will need to continue investing in technology and infrastructure to enhance customer experience and streamline operations. Building on its success and momentum, Walmart should consider expanding its marketplace to greater international markets, mirroring Amazon’s global footprint. By attracting more high-quality sellers, providing excellent fulfillment services, and leveraging the expertise of industry professionals, Walmart has the potential to become a dominant force in the e-commerce landscape.

Walmart’s commitment to its third-party marketplace is evident in its endeavors to attract and retain sellers, expand its reach, and improve fulfillment services. While the road to challenge Amazon’s supremacy is arduous, Walmart’s recent successes instill hope and pave the way for a promising future. With its continuous growth and innovation, Walmart’s online marketplace may soon pose a significant threat to Amazon’s reign in the e-commerce industry.


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