The results are in and Walmart Inc. (WMT) - Reportfirst Annual Walmart+ Weekend was a mixed bag.
Walmart is the only company that has the capacity and resources to compete with Amazon''s (AMZN) - Get Amazon.com Inc. Reportwarehouse-to-door e-commerce pipeline.
Walmart is playing a similar game to Amazon, which has dominated the region for two decades.
In July 2015, Amazon held its first Prime Day, and seven years later, Walmart held its own rebuttal.
Walmart''s profit outlook for the whole year has been slashed, as inflationary expenses and inventory issues eat into its bottom line.
Walmart announces a 5%-6% increase in revenue for fiscal 2023.
"Inflation rates in the United States, particularly in food and energy, put more pressure on margin mix and operating costs," says CEO Doug McMillon.
Despite that, Amazon is dealing with its own financial difficulties, with the company indicating that costs incurred by hiring, supply chain disruptions, and warehouse management would be around $4 billion in the current fiscal quarter.
This prediction comes following Amazon''s shocking first quarter loss of $3.8 billion and its slowest year-over-year revenue increase in more than a decade.
Both companies are expected to watch Walmart+ Weekend''s results closely. An analysis by Numerator, a market research data firm, sheds some light on those findings.
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Walmart Weekend Suffers From Low Awareness
Only a small percentage of Walmart.com shoppers were aware of the sales event that took place from June 2 to June 5.
Numerator claims that just 33% of Walmart''s online shoppers were even aware of a sale, based on evidence from a consumer purchase panel and verified buyer surveys.
The number of Amazon shoppers who received Prime Day last year has decreased by 94 percent.
Despite this disadvantage, the average Walmart+ Weekend spend per order was $69.75. That average is above the average Walmart.com order size of $64.99, and Amazon Prime Day 2021''s average order size of $54.17.
Weekend shoppers were able to receive about three times less orders per household (1.2) than Amazon Prime Day shoppers did last year (2.9). Weekend shoppers also received fewer average orders than Walmart+''s four-day weighted average of 1.6.
In a time when inflation forecasted to last for the rest of the year, most shoppers surveyed the sale to shop for groceries. Nearly 60% of the expenditure stoke groceries, followed by 7% on health & beauty products and 65 on household goods.
During the Weekend, household and garden expenses (5% and 6% of spending respectively) were significantly lower than their average (11% and 9%).
Can Walmart Really Take on Prime?
Walmart+ was first introduced in September 2020 and had 32 million subscribers one year later (as reported by Deutsche Bank).
While Amazon still has a significant head start at 152 million users in 2022, Walmart certainly has a great start, especially for how limited time Walmart+ has been available.
Prime subscriptions continue to rise every year, therefore if Walmart wants to pull ahead, it will have a lot of work to do. Recently, the company hired former PayPal chief financial officer John Rainey.
Rainey is well-known for his ability to use digital media, which might greatly aid Walmart as it continues to develop this service.
