Before we even say a word about the market situation, you yourselves know – the corona virus has changed the buying habits of all of us. Long months of isolations and social distancing also led those who refused the clicks to start ordering pajamas, gadgets and what not – online, and for a long time one could think that couriers to the house are the saviors of all of us. An in-depth review of the Yelin-Lapidos investment house reveals how much this phenomenon has changed – and is still changing – the retail market in the US, and how the queen of electronic marketing Amazon is preparing for it, compared to the American symbol of shopping – Walmart. I read the whole thing to understand what is actually happening here, And so that you won’t be left behind – I’ll give you the main points. It’s still worth it – for those who have the time (and you do, because the courier shopping
brings home), read the full report, which I promise to attach at the end.
1. Let’s start from the beginning: Amazon is a huge piece to fight. As of today, it controls about 38% of the American e-commerce share. The e-commerce industry is expected to grow by approximately 1.3 trillion dollars by 2025, and Walmart’s share in this industry, by comparison, is only 6.3%.
2. On the other hand – it is very difficult to underestimate Walmart. A chain of all-selling hypermarkets that has become, since it was established in the 1960s in Arkansas, not only the retail chain with the highest revenues in the US but also the largest commercial company in the world in terms of revenues (approximately $570 billion annually) and the largest private employer in the world (with approximately -2.2 million workers).
3. As in real estate, Walmart’s main asset is its location. The company has a network of more than 10,500 points of sale (some outside the US – in Canada, Mexico, etc.), and there is almost no American who does not have a Walmart branch less than ten miles from home. This physical presence is also significant in the online arena – because the available branches can easily become highly efficient packaging, distribution and distribution centers.
4. Walmart enters the market late, but with tremendous consumer confidence. Although only five years ago or so, the retailer’s efforts in the electronic arena began to be significant, but it brings with it a dowry of customers who are used to buying everything there, finding everything there, and who are traditionally satisfied with the goods there. The logistical availability of the stores – some of which have become packing and shipping centers and getting to know the consumers and their buying habits, are not something that can be underestimated.
5. Sellers also have reasons to switch to Walmart. The company authorizes third parties to sell through it at a higher profit than Amazon, and requires them to spend less on advertising and logistics. After all that, she can also chaperone them by being present on the shelves in the physical branches.
6. And in the end, there is also a lot of weight for an elderly person who only needs milk. Walmart rests on a solid foundation of ordering grocery products – and this is an ability that it continues to develop without ceasing. As of today, its customers can receive deliveries within two hours, light deliveries by drone and even deliveries that reach the refrigerator – by experienced and reliable employees who get access to the house and go in to arrange the groceries on the spot. This is a place Amazon is having a hard time getting into right now. What will this market look like in two years? We will have to follow.
And in the meantime, you are invited to read the full and fascinating review of Amir Alsheich from Beit Yelin Lapidot, right here: