Amazon vs Walmart Weekly: Prime Day to Q2

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As Amazon was busy handling 100,000 transactions per second at its eighth and biggest Prime Day sales event this week, it was Just Another Tuesday for rival Walmart which is two years into an omnichannel shift that will convert its 4,700 physical stores into rapid delivery micro-fulfillment centers.

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This, at a time when PYMNTS’ exclusive new “Amazon vs Walmart Q1 2022: The Grocery Wild Card” report came out, showing that the category-by-category fight that has been increasingly skewed in the eCommerce leader’s favor has come down to a showdown over groceries.

Furthermore, investors will get the latest earnings results from Amazon in less than two weeks, shedding valuable insight on a quarter that has seen inflation soar to 9.1% and its stock drop another 25%.

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So much for the dog days of summer!

Where July is typically seen as a time of summering school kids, reduced activity and decreased news flow, this year has been an exception as the confluence of economic headwinds, stretched (and stressed) consumers and overstocked retailers looking to clear out unsold inventory have combined to create a bit of a mid-season swirl.

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Prime vs Plus

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While PYMNTS Q1 sales analysis showed Amazon’s share of U.S. retail spending slipped to 8.8% from 10.6% in Q4, rivals Walmart’s take followed a similar — and seasonally normal — slip, falling to 8.2% in Q1 from 8.9% at the end of last year.

In addition, Amazon’s dominant share of eCommerce sales — as measured by the gross value of all merchandise sold rather than the actual revenue booked from sales where it gets a commission or portion of the total — also inched up to 52.8% from 52.6% a year ago.

The net result left Amazon in the lead, after a decade of chasing its older rival, but also showed a narrow of the newly formed gap between, which tightened up to just 0.6 percentage points from a 1.7 percentage point margin in Q4.

At the core of that spread is the ongoing and intensifying fight over food, where Walmart still holds a 9-to-1 lead over the Seattle-based newcomer, which is trying harder than ever to eat away at its rival’s largest and most important source of revenue. Officially, PYMNTS data for Q1 showed the Food & Beverage share coming in at a mile-wide margin of 17.7% versus 1.9%, but even that gap had noticeably tightened over the prior 90 days.

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chart, food beverage sales

With each side committed to winning this final frontier in their ongoing fight, at a time when food inflation is soaring and consumers are scouring for deals, the likelihood is high that there will be more innovation and promotion in the coming months and quarters.

Amid this backdrop, Amazon’s record Prime Day haul showed that reduced pricing and available inventory can still motivate people to open their wallets, at a time when out-of-stocks and sparsely filled retail shelves have become commonplace.

For its part, Amazon continues to add physical stores and incentives to encourage Prime customers to buy groceries online, while Walmart moves ahead with efforts to use its massive 4,700-store base as micro-fulfillment centers that enable it to get goods into consumers’ hands, or on their doorsteps, more quickly.

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NEW PYMNTS SURVEY FINDS 3 IN 4 CONSUMERS WITH STRONG DEMAND FOR SUPER APPS

About: The findings in PYMNTS’ new study, “The Super App Shift: How Consumers Want To Save, Shop And Spend In The Connected Economy,” a collaboration with PayPal, analyzed the responses from 9,904 consumers in Australia, Germany, the U.K. and the U.S. and showed strong demand for a single multifunctional super apps rather than using dozens of individuals ones.



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