Study: Walmart tops Amazon Fresh with groceries that are 16% cheaper
- A study by research firm Gordon Haskett found AmazonFresh groceries generally are 16.1% higher than those found at Walmart stores, according to Business Insider.
- Gordon Haskett also reported that Walmart's price advantage has improved in recent months. In March, the mega-retailer beat other supermarkets' prices by 11.8% and is currently topping them by 13.5%. Comparatively, Amazon was an average of 16.1% higher than Walmart when measured in June, and hasn't improved it's comparable prices since March.
- The research firm compared the same 45 items across five U.S. markets to conduct the report, tracking prices at grocers like Albertsons, Kroger, Randalls, Shaw's, Target, Walmart over time.
A study by market research firm Field Agent found Walmart leads online grocers in fresh purchases amongst its customer base, with 25% of Walmart.com shoppers buying fresh products, compared to just 5% of Amazon shoppers.
There's no doubt that much of this preference is driven by price. Walmart's empire of brick-and-mortar stores gives it a big advantage over Amazon, which has struggled to make inroads in the grocery space for the past decade. The e-tailer's employee-free Amazon Go store concept also has yet to take off, despite industry buzz over its debut.
Of course, Amazon's deal with Whole Foods will give the e-commerce giant a trusted, premium grocery brand to leverage and a collection of brick-and-mortar locations to boost it's grocery game. But Walmart is still a step ahead. The company's massive scale allows it to quickly expand store services such as curbside pickup and store-to-store discounts. Other retailers have struggled to keep pace, and even deep-pocketed Amazon will likely struggle given the steep learning curve it still faces in grocery.
Walmart also has invested heavily in its grocery segment, which accounts for more than half of its revenue, by acquiring e-commerce company Jet.com for $3.3 billion last year. According to Field Agent's report, Jet.com is the most preferred e-tailer for packaged groceries — 44% of Jet shoppers buy packaged groceries compared to 25% of Amazon shoppers.
Still, Amazon stands to gain a lot from its merger with Whole Foods if it's able to solve the grocer's pricing problems. The deal also gives Amazon the chance to turn Whole Foods' store locations into distribution hubs for non-grocery products, which could help it lower costs for other segments.
It will be interesting to see how Walmart will attempt to keep a step ahead as Amazon gains comparable synergies in fresh items. If the discounter moves to drive down prices even further, it could start a race to the bottom that could push already low food prices even lower for shoppers.
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