‘We need even more progress on Walmart.com’, Doug McMillon

Despite reporting strong Q3 FY20 e-commerce sales last week, CEO Doug McMillon told CNBC: “We’re making progress on many fronts, but we need to do more and move faster, especially with our assortment including marketplace.”

“Our strength is being driven by food, which is good, but we need even more progress on Walmart.com with general merchandise,” he added.

“We’re mixing the business out better to achieve better margin rates, but there is more work to do. We’re committed to progress and building a larger, healthier e-commerce business. Our customers want that, our marketplace sellers want that, and so do we.”

Earlier this year, Vox reported that Walmart’s e-commerce division was on track to lose more than $1 billion this year, which was causing internal tensions. But McMillon is confident that grocery pickup and delivery, along with new offerings like Unlimited Delivery and InHome Delivery, will help the retailer “unlock advantages we have to serve customers in a way that reduces friction and enhances convenience”.

“We need to translate this repetitive food and consumable volume into a stronger Walmart.com business that’s profitable over time, so that’s what we’re working on,” he added.

Amazon

Many shoppers are falling out of love with Amazon and opting for Walmart instead, it would seem. The frequency of people buying items on Amazon six times or more per month has dropped to 40% this year from 80% in 2017, according to research by First Insight.

The retail analytics firm conducted three surveys of 1,000 consumers each in December 2017, September 2018 and September 2019. This included shoppers with and without a Prime membership.

55% said they prefer to shop at Walmart versus Amazon, up from about 47% a year earlier. The percentage of people who favour the latter has dropped to 45% from about 53% in 2018. “The excitement of the Amazon box coming to your house is kind of dwindling off,” says First Insight CEO Greg Petro. “I think the novelty of Amazon is wearing off.”