Amazon is set to become the largest retailer in the United States by 2022, overtaking current leader Walmart, according to a report from market research firm Packaged Facts. The firm bases the forecast on the expectation that Amazon sales will continue to grow at a much faster rate.
The report, Amazon Strategies and the Amazon Shopper, 2nd Edition, analyzes the e-commerce giant’s activities in grocery, pet products and financial services.
“Amazon already has an enormous impact on e-commerce sales, benefitting from its creation of an endless online aisle with products at competitive prices,” David Sprinkle, research director for Packaged Facts, said in a statement. “Packaged Facts estimates that Amazon’s U.S. gross merchandise sales will comprise 43% of U.S. e-commerce sales in 2019, up from 28% in 2015. By 2022, we forecast that Amazon will contribute almost half of U.S. e-commerce sales.”
Despite Amazon’s continued growth, Walmart does have advantages Amazon presently cannot match, even when accounting for Amazon’s innovative incorporation of natural supermarket chain Whole Foods in 2017 or its partnership with department store retail chain Kohl’s, according to the firm. Most notably, Walmart’s in-store services strongly differentiate it from online competitors such as Amazon, which cannot provide such services, as well as from its brick-and-mortar competitors, many of which do not offer the same breadth of offerings or cannot match Walmart’s pricing. These services therefore not only produce revenue but also significantly drive traffic, which is even more vital at a time when brick-and-mortar retailers of all shapes and sizes seek to revitalize in-store traffic, according to the firm.
Packaged Facts survey data found that more than 20% of Walmart purchasers use in-store services (including purchasing/using a range of financial services, on-site pharmacy, and optical and photo processing). In addition, Walmart is the click-and-collect king, according to the firm. Among survey respondent click-and-collectors, 43% identified Walmart as the pick-up location for their last click-and-collect order, three times the percentage of those who cited runner-up Target.