Insider Intelligence is out with a new forecast suggesting that Walmart’s share of the online grocery market will exceed 25 percent this year, while Amazon’s market share will drop below 20 percent. By next year, the projections say, “the gap will have widened by such a large margin it will be difficult for Amazon to reverse the trend.”
Walmart’s market share numbers include sales from both the Walmart and Sam’s Cub sites.
Context from the study:
“Insider Intelligence’s online grocery forecast goes back to 2015, with company breakouts going back to 2016. At that time, Amazon was by far the market leader, with $9.28 billion in sales compared to Walmart’s $6.32 billion. That gave Amazon 24.0% of the market compared to Walmart’s 16.3%.
“But in 2019, Walmart surpassed Amazon, doing $1.14 billion more in sales. Amazon has been No. 2 ever since … Looking forward, by the end of 2024, the big-box retailer will have online grocery sales of $58.92 billion, more than $18 billion more than Amazon’s $40.50 billion. That will give Walmart a growing 26.9% share of the online grocery market versus Amazon’s declining 18.5% share.”
“Increasing inflation has led to more deal-seeking and trade-down behaviors from consumers, which favor Walmart over its competitors such as Target and grocery delivery platforms,” said Brian Lau, forecasting analyst at Insider Intelligence, in a prepared statement. “Of course, having a store within 10 miles of 90% of U.S. households has also helped fuel Walmart’s grocery sales, both offline and online, because it means the company has more curbside and in-store pickup locations available.”
KC’s View:
The analysis points to something we’ve talked about a lot here on MNB – that Amazon, despite all its resources and declared focus on inventiveness and customer-obsession seems to have fallen into the silo trap, unable or unwilling to connect the dots when it comes to grocery sales.
It sometimes feels like Amazon is weighed down by its own bulk. Not the nimble, experimental, always-Day-One company of its own mythology, but rather a lumbering behemoth whose eyes, as my mother used to say, are bigger than its stomach.
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