Walmart’s eCommerce business has increased in the past few years, and now, to take that growth to the next level and better compete with rival Amazon, the retail giant is looking to grow its marketplace offerings.
The company announced Tuesday (Aug. 27) a range of updates to its offerings for third-party sellers. At its 2024 Walmart Marketplace Seller Summit, the superstore chain announced the introduction of new product categories such as Premium Beauty and pre-owned merchandise, as well as features designed to simplify cross-market selling.
“We’re executing strategic priorities at Walmart that are helping us to become the customers’ first choice — every day, every season, for every item,” Tom Ward, executive vice president and chief eCommerce officer at Walmart U.S., said in a statement Tuesday. “Walmart Marketplace is a key component of that mission.”
The company also discussed plans for multichannel fulfillment, allowing sellers to use Walmart’s logistics network to fulfill orders from other eCommerce sites, and a cross-border import service to streamline global shipping. In each quarter of the last year, the marketplace has yielded sales growth of more than 30%.
Overall, Walmart’s digital presence is growing quickly. The new edition of the PYMNTS Intelligence “Whole Paycheck” 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 Bureau of Economic Analysis. The findings revealed that the retail giant’s digital mix nearly doubled from the start of 2020 to Q2 of this year, increasing from 9% to 16%. Plus, in the same period, its eCommerce sales surged from $9.3 billion in Q1 2020 to $21.8 billion in Q2 2024.
Now, it seems, the company is 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 Q2, Amazon captured 8.3% of consumers’ retail spending compared to Walmart’s 7.5%.
Third-party marketplaces can provide merchants with 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 its inventory without holding physical stock, reducing risk and overhead costs. Additionally, a robust marketplace can generate new revenue streams through commissions and fees, strengthen the retailer’s brand as a comprehensive shopping destination, and improve overall traffic and engagement on its site.
Consumers, for their part, tend to be more satisfied with eCommerce experiences through third-party marketplaces than through brands’ or retailers’ sites or apps. PYMNTS Intelligence’s report “The Online Features Driving Consumers to Shop With Brands, Retailers or Marketplaces” found that roughly 80% of consumers express being very or extremely satisfied when shopping from an online marketplace. This share is higher than the portions of those who shop from retailer sites and apps (76%) or brand sites and apps (72%) that said the same.
As Walmart continues to bolster its digital strategy, the expansion of its third-party marketplace is a clear indication of its intent to compete more aggressively with Amazon and capture a larger share of the eCommerce market.
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