eCommerce

Walmart, Target Clamor For Holiday eCommerce Bump

Amazon remains the reigning champion in online holiday sales, but Walmart and Target are vying for greater pieces of the U.S. eCommerce market during the busiest season of the year.

Reports in CNBC said this week that eMarketer analysis expects Amazon to capture 48 percent of U.S. eCommerce sales for 2018, worth an aggregate $252 billion. It’s up from the 43.1 percent market share Amazon captured last year.

But Walmart and Target are pushing further into the space ahead of the holiday shopping season as the traditional brick-and-mortar retailers invest more heavily in eCommerce initiatives. Their efforts haven’t impressed investors, however, with shares for the companies sagging.

Target stocks declined more than 10 percent following the release of the firm’s third-quarter earnings results, which missed analyst expectations. The company pointed to increased labor and transportation costs that offset spiking eCommerce sales, which jumped 49 percent. According to reports, it’s the highest jump in eCommerce sales for Target since it started recording the metric.

Digital commerce now makes up or 6 percent of total Target sales, up from 4.2 percent the same period last year. Still, Target expects profits to take a hit during the holidays thanks to rising supply chain costs.

Walmart, meanwhile, said online sales increased 43 percent during the quarter, and expects the year’s eCommerce sales to have grown 40 percent. The retail giant, too, is investing in eCommerce through recent acquisition of digital brands like Jet.com, reports noted.

But investors and analysts are reportedly skeptical that either Walmart or Target can really challenge Amazon‘s online shopping dominance. In Walmart’s case, for example, reports noted rising delivery and other expenses that could limit profits. Walmart shares dropped 2 percent after it reported its Q3 earnings.

“Some people are worried that this is as good as it gets,” said Joe Feldman, an analyst at Telsey Advisory Group, in a CNBC interview. “Comparisons are also getting tougher going forward.”

While Amazon remains the eCommerce leader, reports noted that Walmart’s efforts are expected to pay off in the form of overtaking Apple as the third-largest U.S. retailer in eCommerce sales volume, according to eMarketer research.

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