By Sarah Stashuk / December 14, 2020
So you have an online store and are wondering how to generate the most sales with the highest ROI? After exploring a variety of options for selling your products online, you’ve probably considered Amazon, Walmart, Ebay, Facebook, Craigslist, Wish.com and many others. You’ve narrowed it down to two options and are wondering where to begin, and you ask yourself the same question many other retailers have asked: Walmart vs. Amazon: which is better for online sales? There are a number of important elements to consider:
1. Ease of Use: The initial setup of your store can be challenging whether you’re using Walmart or Amazon, but both platforms are fairly user-friendly once you’ve created all of your listings. However, you may find it smart to hire a firm to set up your Walmart and Amazon online stores, maintain them, and troubleshoot issues that arise, as both platforms can be problematic.
2. Quality of Support: Unfortunately, both Amazon and Walmart Seller Central platforms offer low-quality support that utilizes subcontractors and seeks to close tickets as quickly as possible. You’ll need to monitor your tickets closely and reopen cases immediately in order to get your issues resolved. Many business owners hire a firm to set up and maintain their online stores to avoid downtime and lost sales revenue.
3. Store and Advertising Fees: Walmart has fewer fees than Amazon, with no monthly fee and a small commission (about 15%) on your sales, plus a fulfillment fee if you use that service. Amazon charges a number of fees that make it difficult to generate a profit, such as a monthly store fee ($40), referral fees for product sales, fulfillment fees (for “Fulfilled By Amazon” listings), promotion and coupon fees, advertising fees, and more. While Walmart organically promotes your products, Amazon sellers must pay all promotional fees and buy advertising to gain visibility and sales.
4. Ability to Rank (SEO): Walmart has a newer online marketplace first announced in 2009, while Amazon Seller Central was established in 2000. Walmart sellers can easily gain organic SEO rankings just by posting their products with basic SEO keywords in the product listings. Conversely, most Amazon sellers find it extremely challenging and expensive to attain high organic rankings because the platform is so competitive and its algorithm requires paying to gain visibility. Also, Amazon typically only promotes the top-selling items in each category, and those that have limited returns, many positive reviews, Fulfilled-By-Amazon status, competitive pricing, and ad spend. Even then, Amazon sellers can be disappointed when their top-selling items are suspended for no apparent reason, forcing them to relist and losing hundreds of reviews in the process.
5. Audience Segmentation: Walmart is a low-price leader, promising its customers that they will “Save money. Live Better.” But this is not always the case with their online marketplace, which actually features some items at higher price points than what’s found on Amazon. Some retailers shy away from listing their products on Walmart out of concern that the platform will not deliver their target customer. Retailers don’t typically associate Amazon with a price-sensitive segment due to its widespread adoption, so they are more open to selling on the platform. However, we strongly suggest disregarding preconceived notions, because you might be surprised how profitable selling on Walmart can be.
6. Competitive Landscape: With 20 years of online sales history and more than 2.5 million active sellers, Amazon is a much more competitive marketplace, while Walmart’s Marketplace was launched in 2009 and currently has only 50,000 active sellers. Most business owners find it easier to get started selling on Walmart because it’s a newer platform with fewer competitors.
The Bottom Line: If you’re a new seller without an advertising budget, you’ll find it much easier to get started selling your products with a positive ROI on Walmart.com, due to the newness of the platform, competitive landscape, store fees, and other factors. If you are launching a new product line and want to maximize visibility, we advise you to set up a store on both Walmart and Amazon platforms. Need help with Walmart or Amazon Marketing or have more questions about Walmart vs Amazon online sales? Contact Get Savvy Digital today!
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