Amazon is the world’s biggest online store but Walmart is the world’s biggest retailer. As Walmart endeavours to catch up with Amazon online by copying the retailer’s most successful strategies – trialing lockers to offer in-store collection and same-day delivery – will Walmart go head to head with Amazon in one of the fastest growing e-commerce areas: consumer packaged goods?
Whilst e-commerce may not account for the dominant share of CPG sales, representing just 2% in 2011, it is still the fastest growing retail channel according to analysis from Nielsen. The market research firm predicts that CPG sales from e-commerce will grow 25% year-on-year and more than double its share of total CPG sales to account for 5%.
So will Walmart compete with Amazon in this fast growth area? Todd Hale, Nielsen SVP of Consumer and Shopping Insights, says it must do for Walmart to ever possibly win the web war: “E-commerce is growing at 11% a year, but sales for consumer packaged goods online are more like high double digits. This is the space Walmart has to go after: perishable items. That’s where they need the infrastructure.”
Currently Walmart doesn’t sell fruit and vegetables online and it’s grocery hub, Walmart To Go Delivery, remains in beta. However, Amazon Fresh same-day delivery has recently launched and as Hale commented, “Amazon is already building an infrastructure for perishables. Groceries will be the next battleground coming to the forefront.”
Going head to head with the world’s biggest online store will be difficult for traditional retailers like Walmart as without a physical presence and overheads, Amazon can undercut the competition on price. Therefore to compete effectively, retailers are going to have to do so on price alone. Actionable price intelligence is becoming increasingly critical for retailers who need to understand how to price effectively in order to maximise their return on investment. Price an item too low and they risk losing potential profits, price too high and they risk making no sales.
Monitoring in excess of 50 million products across 4,000 global retail websites every day, Profitero provides the largest reach and coverage in the industry and works with the world’s biggest retailers to grow their sales and increase profit margins.
For further information on how Profitero can make your pricing smarter and grow sales, visit www.profitero.com and download our datasheet or email us at sales@profitero.com.
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About Profitero
Pricing intelligence company Profitero provides retailers with actionable price intelligence data, monitoring over 50 million products across 4,000 eCommerce retailers every day, observing pricing, promotions and stock availability. We work with the world’s leading retailers, enabling them to acquire new customers and grow profit margins by monitoring and responding to changes in competitor pricing and promotional activity as they happen. For more information on Profitero price intelligence and competitor monitoring, visit www.profitero.com or email sales@profitero.com