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Walmart’s biggest weakness vs. Amazon is selection



Walmart is beefing up its
selection to compete with Amazon.

Getty/Rick T. Wilking

  • Walmart
    has set its sights online for growth, beefing up its e-commerce
    offerings with quick and free shipping to compete with Amazon.
  • It still lags behind in one key area, however,
    according to analysts at Cowen. 

    The gap
    in assortment — the actual products offered by and — is still too large, Walmart’s management noted in
    a meeting with the firm.
  • Currently, Walmart only carries about half of the
    best-selling products on Amazon.
  • Walmart has been trying to close the gap between the
    two sites by investing in partnerships to expand its
    assortment, but it’s been slow going.

knows it needs to have the goods.

The country’s largest retailer has set its sights online for
growth, beefing up its e-commerce offerings with
quick, free shipping and other benefits
 as it competes
with Amazon.

But it’s still lagging behind in one area: assortment, meaning
the number and quality of the products being sold on,
according to analysts at Cowen.

“Adding the top million SKUs is essential, doable, and critical
to propelling the [Walmart e-commerce] ecosystem, in our view,”
Cowen analysts said in a note to investors. 

Walmart management agreed that the gap of assortment between and is still too large, Cowen said, noting
that Walmart called expanding assortment a “top priority.”

Walmart only carries a little over half — about 55% — of Amazon’s
one million best-selling products, Cowen notes. That could mean
that Walmart either doesn’t carry many brands or doesn’t have
enough depth in some brands for certain categories of products.

That’s a problem for Walmart as it tries to lure customers away
from Amazon. Amazon’s top one million products account for about
80% of sales on its website, according to Cowen. If Walmart
doesn’t have the goods, customers won’t be convinced to shop
there, no matter what the shipping offering is or how low the
prices are.

Walmart is taking steps to try and change that. It relaunched
both its flagship website, as well as’s
website, this year. It has launched partnerships with brands like

Lord & Taylor
Advance Auto Parts
, and,
most recently, Blue Apron

It has also acquired brands like
men’s clothing brand Bonobos,

women’s clothing brand Modcloth
lingerie retailer Bare Necessities
, and plus-size
women’s brand Eloquii.
 It also created
its own mattress and bedding brand, Allswell

Walmart won’t be able to compete with Amazon overnight, however.

“These factors are now encouraging more brands to sell on and management noted brands are becoming more
interested in Walmart but the process will be a multiyear
journey,” Cowen said.

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