Every online marketplace comes with certain advantages and limitations. This is why you need to be extremely careful when looking for a platform to sell your products. You can sell on either one or multiple platforms. Several factors are to be considered when looking for the right sales channel.
Walmart and Amazon are two major online selling platforms with a huge customer base and almost similar features. But to find an ideal platform that fits your needs, carefully dig deeper into their respective features, challenges, and selling opportunities.
In this ultimate Walmart automation vs Amazon automation guide, you’ll learn all about their pros, cons, and the major differences between the two, so read until the end.
Walmart Vs Amazon: Market Share
|Grocery Sales (Retail)||$270 Billion||$20 Billion|
|Consumer Retail Spend Share||8.9%||6.4%|
|No. of Physical Stores (in the U.S.)||4,700||525|
|Net Ecommerce Sales||5% (approximately)||40% (approximately)|
|Unique Monthly Website Visitors||110 million (approximately)||206 million (approximately)|
Now, let’s compare the two on various parameters:
1. Cost of Selling Inventory
You do not bear any monthly seller or setup charges when signing up with an automated Walmart marketplace. The platform only charges referral fees of around 8 to 15 percent, which is similar to Amazon’s charges.
Besides, if you’re an existing seller, you have the option to sign up for Walmart Fulfillment Services that charge you monthly per-item fulfillment and storage charges. That said, only a limited number of sellers can get approval for the program as it isn’t accessible for the new sellers.
Note that it can cost you thousands of dollars to list a few hundred products on the site. Plus, UPCs are required for listing the products on Walmart (however, there are certain exemptions). GS1 may also charge $50 from sellers as yearly renewal charges.
Here you get a professional selling plan which costs around $39.99 monthly. Generally, there aren’t any listing fees, but each sale has a ‘referral fee,’ similar to Walmart – around 8 to 15 percent. Note that this rate can also be 20 percent for some categories. Moreover, there is also a referral fee for every category.
Amazon sellers must also bear Amazon FBA fulfillment charges determined by weight or unit. There are separate charges for storage fees. Hence, sellers should be aware of their inventory’s performance to keep track of the charges.
2. Listing And Onboarding Process
As a seller, it’s relatively hard to get approved on the Walmart Marketplace. New sellers are required to send the applications and go for a “safety and trust” review.
Moreover, you need to demonstrate your previous selling experience and have high-end qualifications and professionalism to get your application approved. The review process may take several weeks.
After the application is accepted, prospective sellers get a launch checklist, including step-by-step tutorials for registering on the platform as a seller.
Individuals can build new listings through API, excel upload, manual setup, or a software partner. Know that Walmart APIs are comparatively underdeveloped. Formatting the product data correctly is important for keeping up with periodic changes.
Unlike the Walmart marketplace, Amazon has a seamless onboarding process. After purchasing a selling plan, sellers must set up their Seller Central account to create their first listing.
Sellers can manually upload the individual listings using Seller Central. Alternatively, the product listings can be uploaded in bulk through inventory file templates Amazon. There is also a third option – taking the help of an integration partner to categorize and format the product listings.
Note that most product categories on the platform require a standard ID such as European Article Number, Universal Product, an International Standard Book Number, or something similar.
If you already have a seller account on Amazon, you can easily list your products using a GTIN. Moreover, you can also request GTIN exemptions for a few chosen product categories to get your item listed on the marketplace.
3. Product Pricing And Competition
Walmart is strict in terms of pricing. Make sure your products don’t have uncompetitive pricing, or else there are high chances the items will get delisted. The products of most categories featured on Walmart are cheaper than those listed on Amazon.
The pricing culture at Walmart is defined by product parity and price leadership. If any of the products are available at a lower price on a competitor site or sold at a lower price by another seller on Walmart, they will be delisted.
The good thing is that the competition here is low. There are only 50,000 domestic sellers (approximately). It’s fair to say Walmart is nowhere close to saturation, perhaps because new sellers can get thirteen times more monthly visitors than sellers on any other selling platform.
A standout feature of Amazon is that it’s open to all sellers, unlike Walmart. As a result, there is cut-throat price and product competition here, and it fluctuates constantly. Hence, it’s almost a necessity for sellers to leverage automatic prices to stay updated on the price change.
Sellers must track the constantly changing prices and regularly check the algorithms, so they neither lose margin nor potential customers.
Remember, sellers with high sales velocity are more likely to gain higher ranks on Amazon’s search pages. Product availability, text matches, selection, and reviews are some of the important factors that decide the rank of the sellers here. Plus, it also helps individuals fetch better margins for their listings.
4. Performance Metrics
Walmart’s automation system tracks the performance of individuals based on the core metrics. Three-month ODR of the sellers shouldn’t be more than 2 percent. Higher ODR would typically mean higher order cancellation, late deliveries, customer complaints, and product returns for a seller’s listings. Note that too high an ODR generates a risk of account suspension.
Also, a seller’s On-Time Shipment rate should be over 99 percent, and they need to confirm the shipment and enter the tracking information before the ship data is expected. Moreover, sellers should also keep their track rate above 99 percent that could be achieved by ensuring valid tracking data once the shipment is confirmed.
Sellers’ performance on Amazon is tracked based on ODR, cancellation rate, and late shipment rate. The ODR rate for 60 days should be less than 1 percent. Amazon defines the ODR by negative feedback and credit card chargebacks that the seller receives. The cancellation rate for seven days should be less than 2.5 percent, and the Late Shipment Rate should be less than 4 percent for 30 days and ten-day periods.
Generally, Amazon gives a warning to a seller for their first offence before suspending their accounts. Sellers are also given a chance to submit their action plan for handling the issue. They have an opportunity to present evidence to support their case if they are innocent or take necessary measures to satisfy the customer.
5. User Interface For Sellers
Walmart has a long way to go as far as its technology is concerned. The Walmart Seller Center is great, but it could use an upgrade or two. In addition to limited features, it’s also quite cumbersome to navigate.
It’s tedious to perform even the basic tasks at Walmart’s Seller Center. However, third-party integration makes things easy for sellers. Walmart is undoubtedly an alluring channel with great potential. A wide range of product categories gain significant traction, but there is scope for further promotion.
Amazon is considered one of the most mature digital marketplaces. It sells more products more often than Walmart. The platform has heavily invested in refining and developing a wide range of user-friendly tools for the sellers; all these are available in its Seller Central.
Amazon’s seller interface is undoubtedly better than Walmart’s, but it’s not without its shortcomings. It can often be inconsistent and opaque, rendering sellers helpless.
Which Is The Ideal Option For Your Online Business?
Amazon tops the list as far as beginning your eCommerce operations are concerned. But new sellers must strive hard and implement sales strategies that beat the competition on Amazon.
On the other hand, Walmart allows only proven sellers to sell on their platform; it’s tough to enter here, especially for medium and small businesses.
To conclude, both Amazon and Walmart have their unique set of advantages and disadvantages, and the path to success isn’t easy on either of them. If you choose Amazon automation to set up a passive income source, it’s ill-advised to expect results that a Walmart seller would normally expect. Moreover, both these platforms’ user experiences are also completely different.
That said, it’s quite evident that both Amazon and Walmart will soar to new heights in the coming years with continual developments. We recommend you define your preferences and then choose a platform that best satisfies those needs.