Amazon maintained its slight lead over Walmart in total consumer retail sales share during Q2 2023, aided mainly by the electronics and appliance as well as healthcare sectors. Keeping close competition between the world’s top two retailers is Walmart’s strong grocery sales.
Although Amazon seems to be pulling away in several segments, it remains uncertain if those leads will allow the company to take the clear crown in consumer spend or if Walmart’s grocery power and investment in eCommerce growth will enable the competition to remain close — or even flip back in its favor — in coming months.
This installment of PYMNTS’ “Whole Paycheck” series explores the battle of the world’s leading retailers to capture the most share of consumer spending. For this study’s calculations and estimates, the PYMNTS Intelligence research team utilized the two retail giants’ earning reports from Q1 2019 through Q2 2023 in conjunction with national data from the U.S. Census Bureau and Bureau of Economic Analysis (BEA).
The Race for Retail Spend
Amazon captured 7.6% of United States total consumer retail spending, maintaining a slight lead over Walmart for the third consecutive quarter.1
Amazon finally caught up with Walmart in the share of retail sales at the end of 2020, and the world’s top two retailers have been neck-in-neck since. Amazon historically performs best during the fourth quarter, while Walmart usually gains its sales advantage across the remaining three quarters.
In Q2 2023, however, Amazon sold $140 billion in retail products, equating to 7.6% of U.S. consumer retail spend. Walmart’s $133 billion in sales during the same period represents 7.2% of the same retail market, meaning that Amazon has now bested Walmart for three consecutive quarters. If the trend exhibited during the first two quarters of 2023 continues, this could be the first time Amazon will have outperformed Walmart throughout the entire year.
eCommerce Growth
Despite Amazon’s eCommerce dominance, Walmart achieved a 15% growth rate from the last year, compared to Amazon’s 10% growth.
Walmart recorded $18.1 billion in online sales in Q2 2023 or 6.7% of the U.S. retail eCommerce market share. These sales represent a 15% year-over-year growth in eCommerce sales by the retailer, a vast increase from the 5.8% growth during the same period in the preceding year.
Amazon’s eCommerce sales share increased to 50.1% in Q2 2023, up from 45.7% during the same period in the previous year, and the company remains the undisputed leader of eCommerce. The mega retailer has gained roughly 10 percentage points of eCommerce market share since 2019, increasing from 40.8% in Q1 2019, now breaking 50%.
Amazon’s Push to the Lead
The electronics and appliances sector, along with healthcare, are the main segments that led Amazon to surpass Walmart’s performance throughout the past year.
Amazon’s 35.2% share of consumer spending on electronics and appliances in the U.S. during Q2 2023 represents a 4.2 percentage point increase from the retailer’s share during the same period last year. On the other hand, Walmart’s consumer spending share on electronics and appliances has remained relatively unaltered. At 6.3%, Walmart’s share in the segment is nearly six times less than Amazon’s.
Healthcare Sales Gap Tightens
Although Walmart still leads in healthcare products, the sales gap between Amazon and Walmart has tightened.
At the start of 2019, Walmart held a 6% market share in healthcare products, while Amazon’s was nearly three times less at 2.1%. Since then, Amazon has slowly but steadily increased its share in this segment. Despite this, Amazon dipped slightly in Q2 2023, and its 5.4% market share in this segment fell to 0.6% less than Walmart’s. In this segment, the race is close: excluding Q4 2022, the quarterly sales differences between the two retailers in the past quarter represent the smallest difference since 2019.
Amazon’s Strengths
Amazon maintained its lead over Walmart in furniture and clothing and apparel with a 15% sales share in both sectors, roughly double Walmart’s presence.
Amazon’s furniture and home furnishings sales share increased by 85% since Q1 2019, rising from 8.2% to 15.1% in Q2 2023. In that time, Walmart lost ground, with its related sales share down from 9.9% in Q1 2019 to 7.7% in Q2 2023.
Amazon’s sales share in clothing and apparel has followed a similar trajectory, growing 91% from 8% in Q1 2019 to 15.2% in Q2 2023. Although Walmart’s 8% Q1 2019 share was on par with Amazon at the time, Walmart’s sales share in this segment peaked at 11% in Q2 2020 and has remained at approximately 7% for the past year and a half.
The sporting goods, books and hobby segment also continued to be dominated by Amazon, accounting for 31.7% of the U.S. market sales share, up from 27.9% in the same quarter of 2022. Walmart’s share remained relatively unchanged, with 5.9% of the market, representing a 0.1 percentage point rise during the same period.
Walmart’s Strengths
Walmart has been building on its strengths, slightly increasing its grocery market share throughout the last year to a 19.3% all-time high.
While Walmart’s 1.5% expansion in this category in Q2 2023 compared to Q2 2022 may be modest, the retailer’s market share remains robust overall, growing year-over-year for the past four consecutive quarters. Conversely, Amazon has not achieved a significant leap in the grocery segment, capturing just 1.9% of the market at the beginning of 2019 and currently building to just a 2.6% market share.
Conclusion
Since 2019, Amazon has siphoned market share from Walmart in many categories, while Walmart keeps a solid lead in groceries and has experienced relevant eCommerce sales growth. Amazon has consistently made sales gains in more discretionary spend categories such as electronics and furniture, along with sporting goods, books and hobbies, with Walmart‘s shares growing slightly or remaining flat. Although Walmart currently leads in items categorized as discretionary or essential depending on the item, such as those in the healthcare segment, Amazon’s growth is on track to eclipse Walmart there, too. Ultimately, the firewall of groceries enables Walmart to remain neck and neck with Amazon, and it remains unknown whether further eCommerce gains can allow the big box giant to keep Amazon from winning all of 2023.
Methodology
This installment of PYMNTS’ “Whole Paycheck” series, “Less Than 1% Separates Amazon’s and Walmart’s Captured Shares of Retail Spend,” explores the battle of the world’s leading retailers to capture the greatest shares of consumers’ spending. For this study’s calculations and estimates, the PYMNTS Intelligence research team utilized the two giants’ earning reports from Q1 2019 through Q2 2023 in conjunction with national data from the U.S. Census Bureau and Bureau of Economic Analysis (BEA).
1. Includes third-party sales and excludes revenues from Amazon Web Services and subscriptions.↩
