The two biggest ecommerce marketplaces continue to struggle, but one maintains the clear upper hand when it comes to affordable everyday items.
And it’s not who you think it is.
According to a new study by Jungle Scout, consumers are more likely to turn to Walmart than Amazon for groceries and other affordable everyday items (e.g. medicines and cleaning supplies), by a range of 56% to 15%. The data also revealed that 43% of consumers cited product prices as the top reason they would shop at Walmart over Amazon.
The data is included in Jungle Scout’s Amazon vs. Walmart Report 2022, released last week. The study included information from 1,000 US consumers and financial reports. Jungle Scout is an e-commerce platform for businesses looking to sell on Amazon, with retailers generating over $40 billion in annual Amazon sales on the platform.
“The retail environment is constantly changing based on economic trends and consumer whims,” said Michael Scheschuk, President of Small & Medium Business and Chief Marketing Officer at Jungle Scout. “Amazon and Walmart both use online and offline technologies to help brands create more dynamic solutions that keep their customers happy. Investments like Amazon’s Dash Cart in Amazon Fresh stores and Walmart’s Virtual Try-On in their iOS app will raise the bar for all retailers and enhance the consumer experience.”
Amazon is still king
While Walmart (NYSE:WMT) has a distinct advantage in groceries and essential items, Amazon maintains its overall dominance. Jungle Scout found that 73% of U.S. consumers have recently made a purchase from Amazon (NASDAQ:AMZN), compared to just 43% at Walmart.com.
The search process is also more likely to take place on Amazon, where 63% of consumers start their product search there. Only 43% do so at Walmart. Additionally, 57% of respondents had an Amazon Prime membership, but only 31% said they had Walmart’s equivalent, Walmart Plus.
The latest data from Statista shows that Amazon holds an overall e-commerce market share of 37.8%, compared to Walmart’s 6.3%. Both companies rely heavily on third-party vendors, according to the report, with Amazon’s marketplace accounting for 82% and Walmart’s for nearly 79%.
Jungle Scout gave an overview of the activities of both companies.
Although Amazon again dominates e-commerce sales ($50.9 billion vs. $19.2 billion) and subscription sales ($8.7 billion vs. $1.5 billion), it is developing e-commerce sales growth in opposite directions. According to the report, Amazon’s sales fell 4.61%, while Walmart saw an 11.98% increase.
The two companies also differ significantly in other areas. According to Jungle Scout, there are approximately 6.3 million third-party sellers on Amazon Marketplace compared to just 150,000 on Walmart Marketplace. Conversely, Walmart has 3,335 physical retail stores versus Amazon’s 570, resulting in Walmart’s $151.4 billion in sales a significant lead over Amazon’s $121.2. Billion.
Jungle Scout asked shoppers why they chose Amazon or Walmart.
While Walmart had the edge on pricing, Amazon had the edge on shipping prices (40% to 29%) and membership benefits (36% to 19%). Walmart leads in product familiarity (41% to 23%) and repeat or routine customer loyalty (32% to 23%).
Both companies were known for their return policies, with 24% citing it as a reason they shop at Walmart and 23% citing Amazon for the same reason. Of course, Walmart’s physical store network was a factor for 32% of shoppers. Conversely, 27% said Amazon is good for purchasing hard-to-find items.
When it came to how often consumers made purchases on both online platforms, there was little difference between the two companies’ customers, with 8% of customers making purchases once a day at Amazon and 10% at Walmart, and four- to six times a week at 12% and 11%, respectively. Overall, 48% of consumers shop at Amazon and 43% at Walmart at least once a week.
Finally, Walmart shoppers were 71% more likely to spend less than $99 per order than Amazon’s 57%. But Amazon shoppers (33%) were more likely to spend between $100 and $499 than Walmart shoppers (20%).
Click here to see more Modern Shipper articles by Brian Straight.
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