WalmartThe e-commerce business has grown in recent years. To take this growth to the next level and better compete with the competition, AmazonThe retail giant wants to expand its marketplace offering.
The company announced on Tuesday (27 August) a series of updates to its offering for Third party providers. On his Walmart Marketplace Seller Summit 2024The supermarket chain announced the introduction of new product categories, such as Premium Beauty and used goods as well as features to simplify cross-market sales.
“At Walmart, we are implementing strategic priorities that help us become customers’ first choice – every day, every season, for every item,” Tom WardExecutive Vice President and Chief eCommerce Officer at Walmart US, said in a opinion Tuesday. “Walmart Marketplace is an important part of that mission.”
The company also discussed plans for multichannel fulfillment, allowing sellers to use Walmart’s logistics network to fulfill orders from other e-commerce sites, as well as a cross-border import service to streamline global shipping. In each quarter of last year, the marketplace achieved revenue growth of more than 30%.
Overall, Walmart’s digital presence fast growingThe new issue of PYMNTS Intelligence “Total paycheck” The report estimated Walmart and Amazon’s market shares in various categories based on years of earnings reports as well as Data from the U.S. Census Bureau And Office for Economic AnalysisThe results showed that the retail giant’s digital mix almost doubled from the beginning of 2020 to the second quarter. from this year, from 9% to 16%. In addition, during the same period, e-commerce sales increased from $9.3 billion in the first quarter of 2020 to $21.8 billion in the second quarter of 2024.
Now the company appears to be turning to its marketplace to take that growth to the next level. Amazon’s lead in consumer retail spending serves as something of a testament to the effectiveness of the third-party model. In the second quarter, Amazon accounted for 8.3% of consumer retail sales, compared to just 7.5% for Walmart.
Third-party marketplaces can offer dealers a cost-effective way to diversify their product offerings and attract more customers. By allowing independent sellers to list products on their platform, a retailer can expand their inventory without holding physical stock, reducing risk and overhead costs. Additionally, a robust marketplace can generate new revenue streams through commissions and fees, reinforce the retailer’s brand as a comprehensive shopping destination, and improve overall traffic and engagement on their website.
Consumers, in turn, tend to be more satisfied with e-commerce experiences on third-party marketplaces than with websites or apps owned by brands or retailers. The PYMNTS Intelligence report “The online features that drive consumers to shop with brands, retailers or marketplaces” found that about 80% of consumers very or extremely satisfied when shopping on an online marketplace. This share is higher than the share of those who shop on retailer websites and apps (76%) or brands (72%) who also say this.
As Walmart continues to build out its digital strategy, the expansion of its third-party marketplace is a clear sign of its intention to compete more aggressively with Amazon and capture a larger share of the e-commerce market.
