The battle royale for share of wallet between eCommerce trailblazer Amazon and ultra-merchant Walmart rages on, as the latest PYMNTS Whole Paycheck Tracker data shows, with Amazon enjoying an early 2020 lead on the strength of a stellar Q4 earnings report.
Contrariwise, the Bentonville behemoth missed analysts’ expectations for Q4 2019, which Walmart CFO Brett Biggs explained thusly: “The holiday season … wasn’t as good as expected due to lower sales volume and some pressure related to associate scheduling.” The Whole Paycheck Tracker provides context around Biggs’ statements, like unexpected sluggishness in categories such as gaming, and apparel seasonality issues contributing to the financials.
Amazon’s growing strength in general merchandise, from apparel to home goods, has come at Walmart’s expense — trendlines that stand out clearly in the new PYMNTS research. But Walmart isn’t ceding ground willingly, as CEO Doug McMillon made clear to analysts. “We’ve invested a lot to do it, but we’re now in a position to play offense in an omnichannel game,” he said to analysts. “We’ve got a strong set of chess pieces to work with.”
Walmart’s real stronghold continues to be food and beverage. A wealth of tables and detailed graphics in the latest Whole Paycheck Tracker illustrate the horserace between the retail giants across numerous product categories, timeframes and channels.
“The typical American household spends $65,960 per year, the largest share of which goes toward retail spending — 30.8 percent, or a little over $20,000 a year,” according to the latest Whole Paycheck Tracker. “Other leading categories are housing and utilities, which captures 18.5 percent of consumer spending, and healthcare with 16.9 percent. Restaurants, financial services, personal services, insurance, telecom and entertainment/recreation round out the rest of the top consumer spending categories.”
Amazon has been trying for years to crack the code on groceries, with the Whole Foods acquisition a milestone in a strategy that includes cashierless stores and other novel retail concepts geared toward millennials, Gen Yers and new demographic cohorts.
For its part, Walmart has been pouring millions into its eCommerce customer experience in an attempt to blunt the Amazon effect. Online sales have increased smartly for hyper-efficient Walmart, but whether they can best the “Amazon flywheel” and its feedback loop of growth remains to be seen. For students of this epic retail rivalry, the March Whole Paycheck Tracker from PYMNTS is an essential resource for research and insights.