Walmart vs. Amazon in 2024: An In-Depth Analysis of the Battle for Retail Supremacy
Walmart and Amazon have transformed retail through a decades-long rivalry fueling aggressive innovations that benefit consumers. As we enter 2023, how do these very different retail giants stack up against each other? This in-depth analysis examines their performance across key metrics.
Recent Financial Performance and Strategies
Walmart maintains a lead in total revenue, but Amazon extracts much higher profit margins thanks to its dominating ecommerce presence and lucrative cloud computing business.
| Walmart | Amazon | |
|---|---|---|
| 2022 Revenue | $611.3 billion | $513 billion |
| 2022 Net Profit Margin | 3.9% | 7.1% |
"Walmart makes more money right now, but Amazon is growing faster and investing back into disruptive tech like brick-and-mortar retail, healthcare, self-driving cars/trucks, etc.," says retail analyst Neil Saunders.
Amazon‘s sky-high valuation reflects market expectations that its strategic bets in new sectors will pay off long-term. Still, in 2022 Walmart shared plans to invest over $14 billion just in supply chain and automation to compete with Amazon on delivery speeds.
Market Share and Competitive Position
Amazon has toppled Walmart as the #1 retailer in the US by market share across all channels. As of 2023, Amazon accounts for 38% of US ecommerce sales while Walmart lags at just 5.7%.
Globally, here is how the retailers compare in store count:
| Walmart | Amazon | |
|---|---|---|
| US stores | 4,700+ | 589 Whole Foods |
| Global stores | 10,500+ | 589 Whole Foods |
Despite its vast physical reach, analysts say Walmart failed to prioritize its online business soon enough to adapt to the rise of ecommerce led by Amazon.
"Walmart was tentative about committing significant resources to grow its online business," says Forbes business commentator Jonathan Salem Baskin. "It allowed deep-pocketed Amazon to sway consumer buying habits and shopping expectations before addressing them itself."
Now Walmart is aggressively acquiring ecommerce brands, but catching Amazon online remains an uphill battle.
Delivery and Fulfillment Network
Amazon continually sets new standards, raising consumer delivery expectations with innovations like:
- Amazon Prime 1-day shipping on 10+ million items
- Extensive fulfillment infrastructure enabling speed and reliability
- A planned 100,000 electric delivery vans by 2030 to dominate last-mile
Surprisingly, Walmart has the larger last mile presence with 4,700 store locations that double as fulfillment centers for online pickup and delivery. Leveraging this, Walmart+ offers free next-day/2-day shipping on certain items above $35 with in-store pickup at many locations.
But Walmart continues playing catch-up to match the delivery speeds and convenience Amazon offers for its over 200 million Prime subscribers. Amazon’s fulfillment network includes:
- 110 operational fulfillment centers in North America
- Over 200,000 warehouse robots boosting efficiency
- A fleet of cargo planes and thousands of truck trailers
"Amazon’s distribution infrastructure is the foremost reason the company has been so disruptive,” says Toptal business analysis expert Taso Du Val. “It allows Amazon to often provide cheaper, faster, and more reliable fulfillment than competitors."
Product Selection
Both retailers sell an extremely wide range of products, but Amazon again has the edge in overall selection:
- Amazon: Over 350 million products available
- Walmart: 200 million+ products
Notably, each retailer lacks extensive assortment in some categories where the other specializes:
- Walmart dominates: Groceries, household essentials
- Amazon leads: Books/media, electronics, toys, apparel
So shoppers needing to stock up on family basics like food, cleaning supplies, health items may prefer Walmart for convenience and prices. While online shoppers in search of the newest tech products, media, or fashion often default to Amazon’s superior selection.
Technology and Innovation
Amazon continually makes bold investments in next-generation retail tech that pressure Walmart to follow suit:
- Cashier-less stores: Amazon Go versus Walmart’s recently openedcheckout-free store
- Smart shopping carts: Both testing carts that automatically scan purchases
- Healthcare: Amazon Care health service launched after Walmart’s clinics
Additionally, Amazon is pioneering new tech like drone delivery and palm-scanning payment systems with growing patent portfolio of over 13,000 innovations.
“Amazon’s tech advantage allows it to disrupt new sectors and unlock future revenue streams Walmart likely envies,” says author and tech expert Shelly Palmer.
Yet Walmart is ramping up spending on automation, AI-powered tools, blockchain food safety, and more to narrow this tech gap with Amazon.
Grocery Offerings
Both retailers now offer online grocery delivery and pickup, with store networks giving each certain advantages:
- Walmart: More locations for same-day grocery delivery from ~4,700 stores
- Amazon: Quick 1-hour delivery for Prime members living near Whole Foods’ ~500 locations
Walmart also has a price advantage on everyday groceries that appeals to budget-conscious families. But Amazon’s 2017 acquisition of Whole Foods was strategic to capture more premium grocery buyers.
Surprisingly though, Walmart commands about 3 times the grocery ecommerce market share of Amazon, indicating most consumers still prefer buying food items same-day from Walmart stores vs online.
Working Conditions and Controversies
Critics accuse both retailers of underpaying and overworking much of their enormous workforces despite revenue surpassing half a trillion dollars annually.
Recent controversies include:
- Strict productivity quotas for warehouse workers
- Unsafe working conditions like insufficient heat/AC in facilities
- Anti-unionization efforts to suppress worker bargaining rights
In response to negative PR, Amazon raised its minimum wage to $15 per hour in 2018 followed by Walmart to $12 per hour. But many argue much more reform is still needed.
Future Outlook and Competition
Expect Amazon to sustain relentless momentum advancing its lead through aggressive investments in disruptive tech and evolving sectors like healthcare. Yet analysts say Walmart’s sheer scale ensures it stays a dominant force that Amazon cannot ignore.
This intense retail rivalry will likely continue playing out both online and in stores. Walmart must leverage physical locations to enable services rivaling Amazon’s speed and convenience. If not, its reign over in-person shopping may diminish long-term like with books and electronics.
But Amazon‘s limited physical footprint leaves it vulnerable if shoppers ever return more spending to stores. So for the foreseeable future, this unique hybrid competition blending online and brick-and-mortar retail promises to intensify.
