Walmart and Jet’s Chance To Pose A Threat To Amazon

Market Research Analyst


On Monday, Walmart announced that the company would acquire for $3.3 billion. Walmart believes the acquisition will broaden their customer base and add additional capabilities, while Jet CEO Marc Lore appears excited about the scale of Walmart’s purchasing and distribution abilities. Lore has openly expressed his ambition to take on Amazon, so how might this merger help him and his new partners at Walmart achieve this goal? Using 1010data’s Market Insights from July 2015 to YTD, I compared Jet, Walmart and Amazon to see what kind of opportunities, if any, might exist for the new partners as they compete with the e-tailing giant.


Amazon: The Behemoth

There is no denying Amazon’s command of the online retail space. Looking at the second quarter of 2016, Jet and Walmart, combined, only own 7 percent of the online retail market when compared to Amazon. On top of that, 85 percent of both Jet and Walmart’s customers have bought from Amazon in the past year.

Not only does Amazon currently own most of the market, but they also benefit from high conversion rates. 1010data calculates conversion rates by dividing units sold by the number of products views. Based on this calculation,’s customers are more likely to purchase after viewing a product than’s customers are. However, both companies still lag behind Amazon’s ability to convert views into purchases – both Amazon Direct and Amazon Marketplace have higher conversion rates than either Jet or Walmart. Perhaps Jet’s greater ability to convert customers—relative to its new owner—will inform and improve Walmart’s strategy, giving both a better chance to reach for the high bar set by Amazon.

In the near-term, Walmart’s acquisition likely will do little to Amazon’s bottom line, but are there any areas where Walmart can capitalize on Jet’s strengths to close the gap?


Some Surprising Areas of Opportunity

When looking into specific categories, we identified some areas where Jet actually has an advantage over Amazon. The chart below indicates that there are a few categories where Jet’s users are spending more than both Amazon and Walmart customers. On average, Jet’s customers earn more money than Walmart customers, which explains their propensity to spend more. Using our data, we found that Jet customers also spend more than Amazon customers in certain high-end categories, like Fragrance, Athletic Shoes, and Vacuums. Walmart would be wise to pour resources into Jet’s categories like these where they already have an upper hand over Amazon.


Final Thoughts

All in all, this is an exciting acquisition: it’s an opportunity to make both Walmart and Jet more successful by merging technologies and resources. Will there be an imminent threat to Amazon’s business? No. Amazon has a significant lead that will take time to catch up to. Working together against Amazon likely gives them the opportunity to target those categories in which Amazon seems to be vulnerable. If Walmart and Jet can capitalize on some categories where they excel over Amazon, they position themselves to chip away at Amazon’s business in a more impactful way. Even though this deal is not likely to have a substantial impact on Walmart and Jet’s revenue in the near-term, the merger highlights Walmart’s commitment to winning in e-commerce and the importance of doing so. For more articles about e-commerce, follow our blog at



1010data utilizes a number of sources of consumer spending data representing millions of consumers to provide an accurate assessment of online and offline retail sales, market share, and more. Our data enables clients to track consumer behavior using high-quality, granular datasets that are often difficult to source, cleanse, and consolidate.


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