Over 50 million items are eligible for free shipping under ‘Fulfillment by Amazon’ for Prime’s 2-day delivery. This means there are many companies that sell under the Amazon banner, but they are finding it hard to stand out in the market. This has led to another step in the rivalry between Wal-Mart and Amazon, where businesses have decided to split their inventory between these retail giants.
Wal-Mart has been introducing many changes and is offering a wide range of selection for customers. In the latest quarterly report it has nearly 50 million items for sale through its online enterprise. This has led to a steep increase in its online sales to a whopping 63%. It should be noted here that nearly all of this growth can be attributed to the relatively small-scale third party sellers. Wal-Mart offers its third party sellers a better financial term than its rival Amazon.
The Brand Factor
Although Wal-Mart is gaining ground in its online platform, there are still glitches when it comes to buying any branded product through it. For instance, if you search for any Nike product, it will show you list third-party sellers. But on the other hand Nike is dealing this issue with Amazon. Nike is planning to resolve so it can exercise more control over its brand name and at the same time gain access to Amazon’s large customer base.
However, Wal-Mart, despite its large size, Nike has actually shown no interest in signing any deal with it. Although Wal-Mart has acquired Jet.com, Bonobos and Moosejaw, Wal-Mart still has a challenge in its way. Because without big brands willing to directly sell through its portal, it is missing out large percentage of sales. This may further lead to customers dropping out of it altogether when they do not find what they’re looking for. And that might be a terrible sign.
No matter how many third-party sellers Wal-Mart has. If it does not find a better way to include top brands in it, it will lose out of the game eventually. On the other hand, Amazon definitely has a wide range of goods under it. But if it isn’t careful enough, other rivals may soon find ways to outcome it.