Walmart and Battle for Online Supremacy

The 2009 holiday shopping season is shaping up to be the battle of retail’s two titans:, the largest online retailer vs. Walmart, the world’s largest brick and mortar retailer.   For years, at least online, this has hardly been a contest, with Amazon leaving all rivals in its ever growing wake.  This year, however, Walmart has taken significant steps to compete head on with Amazon.

From increased investments in online advertising; improved merchandise quality and selection; the unveiling of an Amazon-esque marketplace; to its aggressive discounting of highly anticipated books and DVDs, it’s clear Walmart is determined to win online.  These efforts are starting to pay dividends online and shoppers are taking notice.  In October, 29% of’s shoppers also visited during the month, up from just 25% last year.

How well did and fare last week during the unofficial "kick-off" to the holiday shopping season, better known as Black Friday?

Generally speaking, mass merchants fared very well online last Friday.  While more people are going online to shop this year, bringing cautious smiles to nervous retailers, consumers are continuing the trend of concentrating their shopping on large mass merchant websites in search of deep discounts and one-stop shopping.

On Black Friday 2009, 43% of all online retail transactions occurred on Mass Merchant & Wholesale Club websites, up from 40% last year.  As a category, Mass Merchants’ gains came at the expense of practically every other category of online retailer, with the exception of Department Stores which also grabbed additional share in 2009.

Within the Mass Merchant category, Amazon continues to attract the largest number of shoppers.  For the first 10 months of this year, averaged 67 million monthly unique visitors; just over twice that of, its closest competitor in terms of size, which averaged 32 million visitors per month.  But as the calendar advanced toward Black Friday, the gap between these sites narrowed.  The chart below shows the daily reach of each site (the percentage of everyone online during the day who at some point visited the sites) for the last half of November (inclusive of Black Friday and Cyber Monday).

On Thanksgiving Day,’s reach exceeded that of for the first time this year. While a large portion of this traffic was a result of shoppers mapping out their plans of attack for Black Friday and eyeing Walmart’s door busters and sales, Walmart also offered specific Thanksgiving Day discounts to drive traffic.  The fact that they eclipsed Amazon on at least one day speaks volumes about how far has come.

One out of every 12 people online on Black Friday visited, making it again the most visited retail website. also fared very well, though it attracted 20% fewer shoppers than  Amazon’s strength was again clearly evident on Cyber Monday as deal seekers swarmed to its site, favoring it nearly 2:1 over

Looking beyond traffic to the actual volume of transactions made on the sites, both rivals had impressive showings on Black Friday.  Nearly 1 out of every 4 purchases made online on Black Friday were made on, up 8% (or 1.8 percentage points) from the previous year.’s share of total online transactions; however, actually rose 17% (or 1.5 percentage points).

Within the Mass Merchant category, Amazon captured nearly 55% of all transactions.  That was down just slightly from 2008; however, as a result of increasing its category share to 23%.

The rapid fire, tit-for-tat price reductions that occurred when Walmart dropped its book prices earlier this fall are clear evidence that Walmart and Amazon are squarely focused on one another and have no desire to see their rivals’ actions go unanswered. Online is the one area of the country where Walmart is not the industry leader, but all indications suggest they intend to give Amazon a real run for its money.

About Matt Pace:
As VP of Millward Brown Digital’s financial services, retail and consumer products practices, Matt is responsible for vertical growth and strategy and the delivery of digital insights and best practice marketing consulting to leading Fortune 500 advertisers. Follow Matt on Twitter @mattpace.