Walmart is increasingly challenging Amazon’s dominance in eCommerce, leveraging its expansive physical presence and digital adaptability to attract consumers who seek flexibility and value. As the October retail sales data rolls in, analysts are seeing a trend that bodes well for Walmart’s strategy.

The Census Bureau’s report showed that retail sales rose 0.4% in October, surpassing the 0.3% expectation, with significant year-over-year growth in eCommerce sales. Walmart, it appears, is uniquely poised to capitalize on this growth.

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Jharonne Martis, Director of Consumer Research at LSEG, highlighted that the most striking aspect of the October data was the 7% year-over-year increase in eCommerce sales. While Amazon continues to benefit significantly from its Prime Deal Days, it is not the only retailer capitalizing on the surge in online spending. “Other retailers piggyback off that promotion and offer their own deals,” Martis explained. “It’s telling us that consumers are still gravitating toward those online deals.” She added that price sensitivity remains a major factor, with consumers only spending on discretionary items when they see substantial discounts.

According to Martis, Walmart is giving Amazon “a lot of competition” by allowing customers to shop on their own terms. “They’re giving the consumer the ability to shop the way they want to, whether it be ordering it on your mobile and picking it up at the store on your way home, or just having it delivered right there from the store to your house. Walmart is definitely giving Amazon a lot of competition,” she told Yahoo Finance.

Omnichannel Excellence

Walmart’s ability to cater to consumer preferences—whether in-store pickup, fast home delivery, or browsing via mobile—has created an ecosystem that not only rivals Amazon’s logistical efficiency but also offers something Amazon lacks: a hybrid shopping experience. This omnichannel approach has resonated with a wide range of consumers. During the pandemic, Walmart gained a large number of new shoppers who were seeking convenience, including many upper-middle-class and affluent consumers trading down. These gains have since solidified into a loyal customer base, contributing to Walmart’s competitive advantage.

“Walmart gained so many shoppers during the pandemic, and then on top of that, they gained even more shoppers over the past two years who were looking to trade down,” Martis noted. “That translates into loyalty, with consumers coming to Walmart as a one-stop shop. As a result, they are likely to do very well over the next two quarters.”

This strategic adaptability is visible in Walmart’s expansion of its grocery and apparel offerings, both in-store and online. By transforming physical stores into fulfillment centers, Walmart has been able to manage delivery times effectively, giving them an edge in an increasingly convenience-driven market. Analysts predict that this capability will prove especially advantageous during the busy holiday shopping season.

Holiday Season Outlook: Value Reigns Supreme

With the holiday season approaching, Martis stressed that Walmart’s value proposition will be critical. “The consumer is very value-oriented, which is why Walmart has become the one-stop shop,” she said. As inflation continues to affect purchasing power, shoppers are turning to retailers that offer competitive pricing and flexibility—two areas where Walmart excels.

The October retail sales data indicates strong consumer resilience, which analysts believe will continue into the holiday season. Yet, this resilience is contingent on the availability of good deals. Martis highlighted that many retailers, including Walmart, are being cautious with discounts. “Retailers are not giving consumers the discounts they want,” Martis said. “Unless you’re getting that magic 40% off, shoppers are holding back.” She added that while Amazon and Walmart have been stingy with discounts, Walmart’s broader inventory, including grocery and essential goods, allows it to maintain foot traffic and cart size even when promotions are conservative.

Tariffs and Challenges

The potential impact of tariffs is another factor that looms over the retail sector. Martis noted that around 20% of retailers have mentioned tariffs in their earnings calls, highlighting concerns about rising costs. However, Walmart’s considerable buying power and diversified supply chain give it more flexibility to navigate these challenges compared to smaller competitors.

“Walmart is very powerful. They can either choose to change suppliers to avoid impacting their gross margins or absorb costs to stay competitive,” Martis explained. She added that Walmart and other major retailers have diversified their supplier networks in response to the disruptions of the pandemic, making them more resilient to geopolitical shifts.

The Battle for the Consumer

As the eCommerce battle between Amazon and Walmart heats up, it has become a battle not just of logistics and pricing, but of value and convenience. Walmart is capitalizing on its unique assets—a vast network of physical stores, a loyal customer base, and a focus on consumer choice—to level the playing field with Amazon.

“It’s more of a battle between the retailer and the consumer right now,” Martis observed. “The consumer is value-oriented and looking for all those deals, but the retailer is still being cautious.” With Walmart well-positioned to continue its momentum, the competition between the retail giants will be worth watching as we head into the holiday season.

The eCommerce landscape is evolving, and Walmart’s approach to blending digital and physical retail experiences is proving to be a formidable challenge to Amazon’s online-only model. As consumers continue to seek both value and flexibility, Walmart is betting that its omnichannel strategy will give it the edge. “Walmart is definitely giving Amazon a lot of competition,” Martis reiterated—and with every holiday sale, discount, and pickup order, Walmart continues to close the gap.