Amazon’s the Biggest in Online Shopping, But Not Always the Best
Although Amazon grabs nearly half of every U.S. dollar spent on the internet, it isn’t winning the digital war on all fronts.
Packages sit stacked in a truck for delivery on Cyber Monday at a United Parcel Service Inc. (UPS) distribution facility in New York.
Photographer: Bloomberg/BloombergAmazon.com Inc.’s dominance in online retail is clear to see: The so-called Everything Store captures 49 percent of retail e-commerce sales in the U.S., thanks in large part to its 95 million-strong army of Prime customers, who in July contributed to an estimated $4 billion spent globally in just 36 hours during a promotional binge that Jeff Bezos created out of thin air. For comparison, that’s more than Church & Dwight, maker of Arm & Hammer baking soda and Trojan condoms, generates in a year.
So Amazon’s the biggest shopping site in the U.S. But is it the best? And how does one measure that, anyway? A common way is to look at how much of a retailer’s total revenue comes from its online division. By that metric–simply, who does the biggest share of their business online–Amazon is worlds ahead of most rivals.
That doesn’t tell us very much, though. For one thing, that metric is declining at Amazon as the company evolves: It now owns the Whole Foods Market grocery chain and also gets almost 12 percent of net sales from its successful cloud business. At Walmart, meanwhile, the online unit is expected to grow 40 percent this year, but it will never be as big of a slice of the pie given that the company operates more than 11,000 brick-and-mortar stores around the globe that deliver about a half-trillion dollars in sales.