You can buy just about anything on Amazon 24 hours a day, and that’s why today’s value shopper is heading to Amazon instead of Walmart.
Amazon offers an easy shopping experience and great prices for the value shopper. For decades, consumers shopped at Walmart for these products, but are now heading online to Amazon. Walmart prides itself on being the low price leader, but according to Brad Tuttle’s article, “Today’s Value Shopper Heads to Amazon, Not Walmart,” other retailers like Target and Amazon actually offer lower prices on groceries and household products than Walmart.
With more retailers going head to head with Walmart’s business strategy, the retail giant is quickly losing market share and its competitive advantage. Consumers are also becoming less satisfied with Walmart’s customer service, resulting in them looking elsewhere for the same deals. Tuttle also suggests that experts “speculate that Amazon could surpass Walmart as the No. 1 shopping destination for the winter holidays at the end of 2012.” In response, Walmart has begun to focus their efforts on their online marketplace in hopes of gaining back the consumers they lost.
Read an excerpt from the article.
YouGov’s BrandIndex specializes in the tracking of brand perception among consumers. If ever there was a prototypical Walmart shopper, it is someone earning $50,000 or less annually. In BrandIndex surveys filtered just for that group’s contingent that at least occasionally shops online, over the last two years the perceived value of goods purchased at Walmart has dropped, while Amazon’s scores have soared.
BrandIndex scores are based on customer feedback—positive and negative—and can range from -100 to 100. A score of 0 would mean equal amounts of positive and negative feedback, and both Walmart and Amazon are in positive territory. But whereas in 2008 and 2009, when Walmart and Amazon were mostly neck and neck with scores usually in the 40s and 50s, starting around mid-2010 Walmart’s scores consistently hovered in the 20s and 30s, with a most recent score of 22. Amazon, by contrast, seems to be giving more bang for the buck, with competitive pricing, abundant possibilities for free shipping—and BrandIndex scores that have stayed mostly in the 50s and 60s over the past few years. At the beginning of April, it got a 71 value rating.
It’s hard to tell exactly how these figures translate into consumer behavior. But retail analysts consulted by Bloomberg say Walmart knows that more and more consumers—including those at the lower end of the economic spectrum—are shopping online, and that it understands Amazon is shaping up as one its biggest competitors, if not the biggest. Kantar analyst Bryan Gildenberg had this to say…