According to statistics, over 263 million US consumers (80% of the population) shop online. That number will rise to 291.2 million by 2025.
We saw a rapid rise in the popularity of online shopping post-pandemic. Now, the biggest question for most US residents is, “Walmart.com vs. Amazon, which one is better?”
Both Amazon and Walmart.com are generating more sales than other eCommerce platforms in the United States. But, there is a considerable difference between selling on Walmart.com and selling on Amazon.
Amazon gets about two billion site visits monthly, while Walmart.com receives about 400 million site visits. That doesn’t mean Amazon is a better platform for your brand.
Both eCommerce platforms have their pros and cons. Your brand should have a presence on at least one of them.
Keep reading to know the best place to sell in 2022.
Top Walmart Marketplace Advantages
Before deciding to sell on Walmart.com or Amazon, let’s first look at Walmart’s advantages. Some of them include:
1. Smaller Product Selection
There are fewer best-selling products on Walmart.com, meaning shops selling unique inventory can stand out. You won’t have to break the bank with PPC (pay-per-click) advertising or giving out discounts.
2. Less Competition
Walmart.com stands out when differentiating selling on Walmart vs. Amazon. That’s because it has a better buyer-to-seller ratio.
The eCommerce platform has almost 100,000 sellers with about 80 million products. Amazon has over 6 million sellers with over 353 million products.
Less competition means third-party sellers can potentially spend less on marketing.
3. Fast-Growing Technology
Walmart is among the top recognizable legacy retailers in the country. It has a wealth of resources available. And the Walmart.com platform is advancing fast.
It is adding robust capabilities around native advertising and listing optimization. As the Walmart vs. Amazon war continues, Walmart will keep innovating new ways to attract more third-party sellers and promote Walmart.com’s top-selling products.
4. Custom Support
If buyers have questions or any issues with a product, they can communicate directly with sellers. Merchants control, manage and specify their customer service information and product return policies.
But there is no specific requirement for all customer emails to get a response within one business day.
Top Amazon Advantages
Amazon Prime membership costs about $15 per month, but it has over 112 million customers. Here are the top advantages of selling on Amazon:
1. Lower Barrier to Entry
You will have an easier time registering an account as an Amazon seller than a Walmart seller. Anyone with a Social Security Number (SSN) can register and sell their products on Amazon within days.
2. Vast Ecosystem of Support
Amazon’s seller support might not have a good reputation. But Amazon consultants and eCommerce agencies provide excellent support to sellers.
The eCommerce agencies specialize in SEO, content creation, and registering brands. The experts at Amazon help brands identify what works for them.
Brands get to optimize their listings, which leads to better performance.
3. Access to Prime Audience
As a seller, you will stand out easily on Walmart Marketplace. But we can’t ignore the over 200 million Amazon Prime members worldwide.
Prime is popular among Amazon customers because of its fast, free delivery. Sellers gain immediate credibility even with relatively new shoppers.
4. Sophisticated Buy Box
On Amazon Marketplace, having the lowest price will not always win the buy box. The buy box is the white box on the product’s right side with its details – where customers can add the item to the cart.
The things that influence buyers to buy include:
- Product availability
- ODR – Order Defect Rate
- Search text matches
- Feedback rating
- On-time shipping rate
You will find all these elements on Amazon. That gives the sellers more control over their product pricing and profitability.
Key Differences Between Selling on Walmart Marketplace Versus Amazon
Before you decide to sell on Walmart Marketplace or Amazon, know their differences and similarities. The key differences between Walmart Marketplace vs Amazon Marketplace are as follows:
1. Selling Fees
Walmart Marketplace fees are straightforward as compared to other eCommerce platforms. Here are the main differences between Walmart and Amazon’s selling fees:
Walmart Marketplace Fees:
You won’t have to pay a monthly fee when selling on Walmart.com. Also, the platform has a straightforward referral fee structure.
Most products will require you to pay 15% of the price of the item you sell on Walmart.com. If you fulfill the orders alone, you only need to pay the referral fee without any other hidden fees.
You might want to use the Walmart Fulfillment Service (WFS). The service will require you to pay some additional fees.
But it’s a competitive and cost-effective solution that saves you on fulfillment costs. Note that Walmart.com doesn’t share its fulfillment fee structure.
The weight and product dimensions will determine your fulfillment and storage fees.
At Amazon, you can choose to fulfill your order (FBM or Fulfillment by Merchant) or have Amazon handle the order fulfilments (FBA). But both storage and fulfillment fees are different between Walmart.com and Amazon.
The cost of your fulfillment won’t include the shipping costs. Factor in the shipping expenses before defining your business profit margin.
You will only pay for Selling on Amazon fees if you choose to sell through FBM. The service includes a Variable Closing Fee and Amazon Referral Fee.
You will have to pay Amazon based on your warehouse inventory. There are also inventory clean-ups after 15 days each month, which brings about long-term storage fees.
For any product that’s in the warehouse for over 180 days, you will have to pay $6.90 per cubic foot of storage space used. Amazon will also charge $0.15 per unit on any product in their warehouses for over 365 days.
2. Business Requirement
There is more intense seller competition on Amazon than on Walmart.com. Here are the few requirements on each platform that adds to the discrepancy:
You might find starting on Walmart.com challenging if you’re a beginner. Here are the various documents you need to set up a Walmart shop:
- US Business Address
- US Business Tax ID
- W9 or W8
- A planned product catalog integration method
- Product categories, catalog size, and other needed information
Currently, Walmart only allows businesses registered in the US to run a business on its platform. But there could be changes in the future.
As a new seller, it’s easier for you to sell and grow your brand on Amazon. You don’t even have to know the product you will sell before setting up an account.
You must have these requirements before completing your registration on Amazon:
- Valid phone number
- Valid credit card
- Bank account and routing number
- National ID
- Tax information or SSN
Amazon allows international sellers to set up accounts and grow their brands on their platform. These are the countries Amazon allows as long as you have a valid credit card and phone number.
Key Similarities between Selling on Walmart Marketplaces Versus Amazon
You should know some key differences between selling on both eCommerce platforms first. They include the following:
1. Fulfillment Services
On both eCommerce platforms, you can choose to fulfill the order yourself or have the platform do it for you. Though Amazon has had FBA since 2006, Walmart introduced WFS in 2020.
Both the FBA and WFS offer similar time and money-saving benefits. Your site must have high visibility and search rankings to be the best seller on Walmart.com or Amazon.
The only difference is that you must ship products to FBA warehouses with Amazon and fulfillment centers in the US with Walmart.
2. A Guaranteed 2-Day Free Shipping
Walmart Marketplace and Amazon both provide their customers with 2-day fast shipping. That is through their fulfillment services.
But that was not the case before 2020, when Walmart Marketplace sellers had to fulfill each order.
Now, Walmart supply chain logistics handles all product fulfilments within two days. That applies even if the customer doesn’t have the Walmart+ membership.
The Walmart+ delivery subscription service directly competes with Amazon Prime.
Currently, there are more Amazon Prime members than Walmart+ members. However, Walmart’s comparable fast and free shipping option will bring more customers to the eCommerce platform.
3. Listing Optimization
You must optimize your listings to have Amazon and Walmart top-selling products. Optimization increases your brand’s search engine discoverability, which increases its organic ranking.
The best-sellers at Walmart and Amazon focus a lot on listing optimization and market and product research. Walmart and Amazon are different, but their customers want the same products.
Start Selling on Walmart Marketplace or Amazon Now
Selling on Walmart Marketplace or Amazon has its pros and cons, though both platforms offer an excellent opportunity to reach many customers. Amazon is more beginner friendly, but you can sell on Walmart.com with a registered US business.
Consider setting up accounts on both platforms to avoid putting all your eggs in one basket. Want more insights on selling on Walmart and Amazon? We can help.
At Algopix, you will have access to real-time eCommerce insights. Try Algopix today to learn all about starting your eCommerce business.