retail news in context, analysis with attitude

MarketWatch reports that Walmart's online growth has not lived up to the company's expectations despite the investment of millions of dollars, and the reason seems to be that its shoppers prefer shopping online at Amazon.

According to the story, "In April, 56% of Wal-Mart’s supercenter customers said they had shopped on Amazon.com over the past four weeks while just 17% had visited Walmart.com, according to a monthly survey of about 2,300 shoppers on average by consultancy Kantar Retail."

The story goes on: "Worse for Wal-Mart, the trend is going in the wrong direction. In early 2009, a significantly fewer 32% of its in-store shoppers said they shopped at Amazon. The number who are Amazon Prime members has jumped to 21%, from 10% in 2011. The increases are across all demographics. Among those Wal-Mart shoppers with household income of at least $60,000, 31% of them are Amazon Prime customers, more than double from 13% four years earlier. Among millennials, 32% use Amazon Prime, up from 18% in 2011. Meanwhile, the percentage who said they shopped at Walmart.com has risen only modestly, to 17%, from 14% in 2009."

Addressing the disparity, Walmart spokesman Ravi Jariwal says, “It’s important to realize the future isn’t just brick and mortar and it isn’t just online. It’s a combination of the two that allows the customer to choose when, where and how they want to shop. Walmart is uniquely positioned to serve customers and make shopping easy and convenient between online, mobile and stores.”
KC's View:
Uniquely positioned, perhaps, but Amazon has tapped into the consumer psyche in a way that Walmart's online offerings have not yet been able to. This, by the way, is why Amazon cannot afford to take its food off the gas pedal when it comes to investment and innovation. If it lets up, Walmart potentially could make up some of the distance between them.