Walmart teams up with Shopify to give Amazon a run for its money
Walmart is serious about growing its online marketplace business. The retailer has teamed up with Shopify to enable sellers from the platform to sell their goods on walmart.com.
The agreement between the two companies is potentially bad news for Amazon.com. Walmart is the second biggest e-commerce site in the U.S. and growing its business at a rapid pace (74 percent in the last quarter). Shopify is the second largest online platform in the country with more than one million companies.
Jeff Clementz, vice president, Walmart Marketplace, wrote in a company blog yesterday that the retailer is committed to growing its third-party seller base and is focused on recruiting small and medium businesses with product assortments that complement its own and with stellar records of customer service. Initially, 1,200 Shopify sellers will list products for sale on walmart.com.
Research published earlier this year by Tinuiti puts the number of third-party sellers on Walmart at 33,000. Fifty-seven percent of Amazon shoppers also shop on walmart.com.
Shopify sellers will be able to “seamlessly list” products for sale on Walmart’s site, according to Mr. Clementz’s post.
A spokesperson for Walmart told RetailWire that Shopify sellers “can apply to utilize Walmart Fulfillment Services (WFS).” The service is positioned as a low-cost way for third-parties to use Walmart to pick, pack and ship items ordered from walmart.com.
In an email received by RetailWire, Moody’s vice president Charlie O’Shea said the Shopify deal continues Walmart’s successful expansion with third-party sellers like Advance Auto Parts on its site.
Walmart and Advance announced a deal in 2018 that included value-added content and product information from the auto parts dealer. Shoppers ordering from Walmart’s site can get same-day delivery or pick up the parts at either retailers’ stores.
Mr. O’Shea sees store space as a “key competitive advantage” for Walmart that it can use to expand its third-party partnerships.
“One of the critical factors involved in these relationships is the logistics capability of the large partners, and in the case of Walmart and Amazon, it will be interesting going forward to view the differences between a store-driven model and a largely pure-play delivery model and their impact on these third-party relationships,” said Mr. O’Shea.
- Walmart Expands Its eCommerce Marketplace to More Small Businesses – Walmart
- Shopify – the good shop to Amazon’s bad shop – The Guardian
- The Ultimate Walmart Marketplace Guide (Pros, Cons, Secrets and More) – Tinuiti
- Will fulfilling third-party vendor orders give Walmart an edge over Amazon? – RetailWire
- Walmart and Advance Auto Parts join forces online – RetailWire
DISCUSSION QUESTIONS: What is your take on the significance of the Walmart/Shopify deal? What will it mean for Amazon and others such as Target that also have online marketplaces?