Amazon and Walmart have long been the dominant forces in the retail game, but changes to the global marketplace — spurred by the pandemic, the precipitous spike in eCommerce spending, persistent snags across the supply chain and inflation — are reshaping the entire space.
That hasn’t done anything to knock Amazon and Walmart off the top of the retail spending heap, but it is changing how consumers are spending and what products they want. Through the end of the first quarter of 2022, Amazon accounted for 8.8% of gross retail spending and 3.4% of consumer spending, higher in both cases than Walmart, which was at 8.2% and 2.8%, respectively, at that point.
“While Walmart has transformed its business strategy in recent years to include bold innovations — like the drone delivery that Amazon pioneered and curbside pickup — Amazon continues to lead the 60-year-old retail mainstay,” according to the PYMNTS study “The Ongoing Battle for Consumer Retail Spend: Amazon Versus Walmart Q1 2022: The Grocery Wild Card.”
Read more: New Data Shows Amazon and Walmart’s Battle for Retail Spend Will Come Down to Grocery
Amazon’s dominance of gross retail spending has slipped since the fourth quarter of 2021 from its high of nearly 11%. This may change as both companies compete to earn a portion of “revenge travel” funds reentering consumers’ budgets and reclaiming spend now diverted away from products to experiences, including travel and dining out.
Walmart’s promise of everyday low prices or Amazon’s frictionless Subscribe & Save bundle that handles grocery and adds savings for plan-ahead purchases may help both companies drive new sales after both saw their revenues slide amid increasing inflation to levels not seen in recent years.
But Amazon remains the unchallenged eCommerce leader, holding 51% of the market in Q1 2022 and notably dominating the sectors for clothing and apparel as well as electronics and appliances. Subscribe & Save has a membership equivalent to 8% of the American adult population and leads among retail subscriptions.
“The prospect of continuing inflation is amplifying Amazon’s appeal to Walmart’s customers,” the study stated. “As consumers factor in rising prices at the gas pump and in stores, Amazon’s Subscribe & Save may draw consumers ready to shift weekly purchases to digital.”
For more information, download the study.
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