OPINION

Amazon Prime Day, Walmart Plus Week and the Battle of the Retail Giants
By Peter Coy

e-commerce expert and Bazini Hopp client, Rick Watson was quoted in an opinion piece on Amazon v. Walmart:

I asked some economists and e-commerce experts to size up the battle. Rick Watson, who runs an e-commerce consulting firm called RMW Commerce Consulting, told me that the companies put on sales in July because it’s otherwise a slow time, and because they need to clear shelves to make way for fall and winter inventories. He said the sales are aimed at building customer loyalty: rewarding Amazon Prime members and attracting Walmart Plus members.

“From Amazon and Walmart’s point of view it’s very hard to be a profitable retailer on retail alone so the battle has moved to everything but the goods themselves — namely, services,” Watson wrote in a follow-up email. “For Amazon, that’s computing (Amazon Web Services), advertising and fulfillment/Marketplace. Walmart doesn’t have A.W.S. but is copying all the other Amazon elements.”

Amazon’s Prime service still beats Walmart Plus. It costs more, at $139 a year, compared to $98 for Walmart Plus, but it also offers more, including unlimited streaming of movies and TV episodes. Amazon Prime had 168 million customers in the United States in June 2022, while Walmart Plus had 11.5 million in January 2022, according to reports by Consumer Intelligence Research Partners.

Where Walmart tends to win is on price, bricks and mortar. Lower prices are especially valued when times are tough, Watson said. Plus, he said, some people just like shopping in an actual store: “Shopping is still a social activity. Browsing from your bed is never going to replace that.” You can’t palpate an avocado or a pineapple on the internet. Or try on a dress. A customer who orders 10 clothing items online and ships back nine of them is much more costly to a retailer than a customer who brings 10 items to the dressing room, tries on three and buys one.

Read the entire article at NYTimes.com.