Online sales are surpassing those of the traditional points of sale: Amazon has just deposed Walmart

Amazon's ascent in the USA and around the world is the culmination of Jeff Bezos' long-term vision

According to the e-commerce founder, the convenience of online shopping combined with quick home delivery was destined to win

Almost 30 years and a serious pandemic were needed, but for the absolute first time Amazon's sales surpassed those of Walmart. Amazon has become the biggest retail seller in the world [outside China, where Alibaba reigns supreme]. According to Wall Street's estimates compiled by the financial research company FactSet, American consumers spent more than $610 billion on Amazon between June 2020 and June 2021, while Walmart's sales of the same period were around $566 billion.

By exceeding Walmart the American e-commerce giant dethroned one of the most successful - and most dreaded - companies of recent decades. In spite of Walmart's power and efficiency, in fact, the challenge to dominate the retail sales sector today is being won on the Internet. And no company has taken advantage of it better than Amazon.

The emerging brands in the United States have to find an element that differentiates them from their competitors

Instead of trying to compete with Walmart, Amazon concentrated on something completely different: making the online shopping experience the most convenient possible so that people would prefer to buy online rather than visit the physical point of sale

Walmart's hybrid model seemed to offer clear advantages, such as to allow American consumers to see their products in person before making the purchase or to try on the clothing to make sure it was the right side. But then the pandemic arrived, and more and more people embraced the safety and convenience offered by Amazon, which offered many more products and delivered them directly to the consumer's home.

Besides the attention it pays to e-commerce, Amazon differs from Walmart in another important way. Compared to Walmart, Amazon as well has a vast inventory, but its true success depends on the third-party sellers that use it as a simple selling platform (according to The Times, 56% of items sold by the company come from outside sellers).

The result? Amazon has lower overhead costs and makes higher profits, so much so that according to eMarketer, US e-commerce captures 41 cents of every dollar spent online in the United States versus the 7 cents Walmart takes.

The pandemic gave the e-commerce sector a strong push, and Amazon was able to intelligently seize the opportunity

Both companies have their specialties. Walmart is the colossus of physical discounts with the highest number of brick and mortar in the US. About 90% of Americans live within 10 miles from a Walmart. Amazon, on the other hand, is the colossus of online shopping and possess roughly 40% of the e-commerce market. Amazon's speed in delivery surpasses all its competitors, but its advantage runs the risk of dropping off over time since Walmart heavily invests in strengthening its logistics.

Therefore, Amazon has to continue in its aggressive policy of opening new distribution centers and understand which strategy to use for building physical stores. Walmart is already doing so at a slower speed. The idea is to refine its omnichannel strategy (multi-channel sales management) to stay on the lists in the battle for supremacy in the retail sector.