After three straight quarters of lagging Amazon in the race for consumer retail spending, 2021 will prove to be the first year in decades that Walmart isn’t the largest US retailer.
Fourth-quarter results are still weeks away, and much of the peak of the holiday shopping season has yet to unfold, but Walmart has been stuck with about 8.5% of retail spending for most of this year, while Amazon is consistently hovering around 9%. Additionally, nearly 71% of this year’s Black Friday shoppers made online purchases at Amazon, while only 41% made digital purchases and 59% shopped in person at Walmart.
Read more: Black Friday results pressure Walmart to keep up with Amazon
And: Amazon finally matches Walmart for consumer retail
The proprietary data for PYMNTS is derived from an aggregate market value viewpoint, which tracks the full value of everything sold, not the actual revenue companies earn by partial commissions on items sold through third parties on their platforms. For example, if Amazon sold a $50 set of knives but booked only $5 in revenue, assuming it charged the merchant a typical 10% referral fee, PYMNTS’ use of the former metric provides a more holistic view of where consumers are actually spending their money.
On an annual basis, as of 2020, Walmart had a 9.5% share of retail consumer spending versus Amazon’s 9.2% share.
The categories in which Amazon beats Walmart the largest are the areas that usually get the hottest on holidays: electronics, toys, hobby equipment, and apparel and clothing. In fact, the PYMNTS Black Friday study found that two-thirds of consumers plan to purchase clothing this holiday season, 33% plan to purchase toys or hobby equipment, and 26% plan to purchase consumer electronics.
See more: Stockpiles costing retailers up to $4.6 billion on Black Friday
In electronics, Amazon has been at the forefront for years; The e-commerce giant has seen its share rise from less than 10% in 2014 to over 25% in 2020. Meanwhile, Walmart’s share has fallen from just over 9% to less than 6% over the same time period.
Amazon’s dominance in clothing and apparel is a recent development, only occurring in 2018, but the pandemic has helped the company consolidate its strength as most consumers were forced to shop only online for most of 2020. Amazon’s share of the apparel and apparel category peaked in the fourth quarter of 2020. It has steadily declined since shoppers returned to traditional stores, but Walmart has also seen its market share decline, minimally closing the gap.
Walmart’s latest offers
Walmart isn’t quite behind the eight-ball, although it still holds its title as the dominant grocer in the US, an area that Amazon has struggled to break into despite its 2017 acquisition of Whole Foods and a slew of Amazon Go locations. At the end of the third quarter, Walmart was nine to one ahead of Amazon in food and beverage sales.
However, Walmart’s share of grocery sales has fallen slightly over the past several months after peaking at more than 20% in the fourth quarter of 2020. While the Arkansas retailer has consistently seen its share at around 19% for years, It dropped below that threshold earlier this year and I haven’t come back yet.
However, Walmart executives say internal numbers show its leadership in grocery is growing, particularly as it targets consumers put off by price hikes.
“Our grocery unit growth is growing faster than the dollar, and that’s where we’d like to stay for as long as possible,” John Woerner, president and CEO of Walmart US, told analysts on a conference call last month. “We want to keep prices low for customers across the company, and we’ll be the last to go up.”
See more: Walmart raises the bar in groceries to pricing competitors
However, as PYMNTS previously reported, Walmart’s dominance in food and beverage likely won’t stop Amazon from overtaking it — many other categories have been lost to the e-commerce giant, and consumers have shown no signs of slowing their adoption of digital shopping.
Read more: Grocery power probably won’t help Walmart keep Amazon at bay
Amazon and Walmart are also investing in areas outside of retail to attract more consumer spending; After all, retail is only a third of what people spent in 2020.
Housing, at close to 20%, holds the next largest share of consumer spending, closely followed by healthcare – an area the two retail giants are particularly interested in – at 16%.
Walmart in particular has been in trouble in recent months, acquiring telehealth provider MeMD in May, rolling out brand-name insulin in June and partnering with health records platform Epic to create a portal for Walmart Health members in September, for example. Not limited to initiatives.
“Our vision to provide best-in-class healthcare, anywhere, anytime, includes a seamless experience for our customers, healthcare professionals, and partners,” said Dr. Sheryl Begos, executive vice president of Walmart Health & Wellness, in a statement. Announcing the partnership with Epic.
Related news: After Walmart Acquisition, MeMD CEO Shares Vision for Omnicare’s Healthcare Delivery Model
Amazon is also steadily increasing its healthcare offerings, although it has been quieter than its box-store competition. Through Amazon’s Web Services division, the company is building a digital infrastructure that hospitals can use to manage records, assist with procedures, and use artificial intelligence (AI) to predict when a person will become sick. Amazon also offers telehealth, Amazon Care for its employees and other partner companies, as well as an online pharmacy.
See more: Amazon introduces the latest telemedicine healthcare game
In the third quarter, Amazon had 3.4% of total consumer spending compared to Walmart’s 2.9%, roughly the same stock each company held at this point last year.