Surging online shopping during the pandemic saw Amazon’s share of retail sales spike higher last year and come within striking distance of overtaking Walmart, new data analysis from PYMNTS shows. The online giant’s 9.2 percent portion of overall retail spending now nearly matches the chain store leader’s 9.5 percent share of retail activity.
While Walmart’s 9.5 percent share of 2020 retail sales was up from the 8.9 percent level it posted in 2019, the impact of the ongoing digital shift was amply evident in Amazon’s new position, which saw its share of total retail jump by roughly one third from the 6.8 percent retail stake it held in 2019.
The tightening trend of the Whole Paycheck battle for market share of retail sales between the two competitors has seen Walmart’s lead shrinking for years, but it’s never been as close it is now.
For example, since 2015, Walmart has maintained an approximate 9 percent share of the total retail spending pie, whereas Amazon’s stake — fueled by digital sales — has tripled from just 3.0 percent five years ago to its most recent full-year tally of 9.2 percent.
It’s All About Digital
Not surprisingly, the digitally native Amazon’s increasing share of overall retail has been enabled by its dominance within the digital world. According to PYMNTS data, Amazon took in 51.2 percent of total U.S. digital retail sales last year, up from 48 percent in 2019 — but most pointedly, roughly 10 times the online share held by its rival.
To be fair, Walmart did substantially increase its share of eCommerce to 5.6 percent in 2020 from 4.2 percent in 2019, although that did little to close the 40-plus point margin between the two.
Amazon Is New Total Spend Leader
Of the $62,300 of spending a typical U.S. consumer did last year, PYMNTS data showed that roughly one-third of it went to retail purchases, amounting to over $20,000 of annual buying — 20 percent of which (or $4,200) was done online.
Because of the importance and scope of retail spending, its impact on the shifting share of total consumer spending also increased last year, and for the first time ever, saw Amazon taking the lead. According to PYMNTS analysis of full-year share of total consumer spending, Amazon now accounts for 3.3 percent in the U.S. versus Walmart’s 3.1 percent position. A year ago, Walmart was ahead of Amazon with a 2.7 percent share of total consumer spending versus Amazon’s 2.3 percent share.
Although Walmart’s top-line total revenues still outpaced Amazon’s in both the fourth quarter and full-year 2020 reports, the 60-year-old Arkansas-based retailing giant has just pledged to invest $14 billion into new technology and automation as it strives to grow its online business.