Covid outbreak sees Amazon become bigger than Walmart

The New York Times is reporting that consumers spent $610 billion at Amazon from June 2020 to June 2021, based on estimates from financial research firm FactSet. In that same time frame, shoppers splashed out $566 billion at Walmart.

So, how did Amazon become larger than Walmart based on sales?

How did the latter, with over 5,339 stores in the US, fall behind Amazon when it only has a fraction of that number?

The Covid-19 pandemic has accelerated the increase of e-commerce sales and that undoubtedly benefited Amazon.

However, according to Brittain Ladd, a supply chain consultant and former Amazon exec, the real reason why Amazon has overtaken Walmart is down to culture and mindset.

“Amazon embraced e-commerce. Walmart ignored the growth of e-commerce for years and instead focused on its stores. Walmart has been playing catch-up but Amazon is easily staying ahead of it,” Ladd said in a LinkedIn post.

Amazon is also a virtual company. “It embraces thinking big and they have a team of executives and associates who are arguably the best in business. Whenever Amazon does something they usually succeed because everyone there believes they can virtually do anything.”

In many ways, Walmart has made it easy for Amazon to beat them, Ladd believes.

For example, Walmart CEO Doug McMillon, has been in that position since 2014.

”I continue to believe that McMillon should have been replaced as CEO in 2019. He is using the wrong strategy against Amazon, and I don’t believe he is capable of stopping Amazon’s continued dominance,” Ladd commented.

“Instead of replacing McMillon with an insider, I strongly encourage Walmart to hire a CEO from outside the company.”

The fact that Walmart generates over 55% of its revenue from the sale of groceries is a perfect argument for bringing in Pyaterochka’s Sergei Goncharov as the next CEO, he argued.

“What’s certain is that Walmart needs to re-examine its executive team and strategy. I don’t see anything on the horizon that will slow down Amazon, so Walmart needs to build a better mousetrap. Fast,” Ladd concluded.