Amazon Vs Walmart Vs Best buy Vs Target
The biggest eCommerce in the US are facing interesting times due to the novel COVID-19. Make no mistake, even in quiet times, there is a constant battle between Amazon, Walmart, Best Buy & Target for customer affection and money. The new reality force those players to change their strategy & tactics.
Governments all over the world have instructed their citizens to work from home, placed entire cities under lockdown and closed off schools and factories. Additionally, people have been practicing social distancing, avoiding public, crowded places.
For example, the Chinese government imposed quarantines have forced factories to send their employees home and close temporarily, causing shortages in imported goods including athletic footwear. These limitations have been causing major issues, especially since China is responsible for over 70% of global retail manufacturing.
So, imported goods are not coming into the U.S. in the same quantities as before.
Additionally, people confined to their homes have been relying more and more on online shopping and delivery. The shift to online retail has brought on extreme pressure on eCommerce giants like Amazon, Walmart and Target, which have become a lifeline for many during the COVID-19 crisis.
For example, we can look at the US Skin Care market, where three of the American eCommerce giants experienced sharp changes in customer review volume and sentiment.
The surge in review volume is closely connected to increased sales, reflecting reports on increased ecommerce sales during early March 2020. As we can see in the following graph, Walmart has seen an increase of just under 200 reviews in the period between February 26th and March 4th.
At the same time, Amazon has almost doubled its review volume, jumping from just under 6,000 reviews in late February to almost 12,000 in the first week of March.
Target is also benefiting from this eCommerce spring, adding around 100 new reviews over the two-week period.
Unfortunately, due to the increasing demand retailers have been under growing pressures struggling to keep up with the tsunami of orders.
Both retailers and consumers were caught off guard, leading to a 10% drop in sentiment in early March –
A similar shift in both volume and sentiment was identified for the Running Shoes US market segment.
The following chart shows consumer review volume and sentiment for Amazon.com for a three month period, between January and March 2020 –
With a major plummet in sentiment occurring during the first two weeks of March 2020.
Nonetheless, from only 15% positive sentiment in March 11th, the three retail superhouses have managed to adapt to the ever changing circumstances and create a rise of over 50% in sentiment.
This shift in sentiment can be attributed to major efforts Amazon, Walmart and Target have put into adapting and optimizing its operations – from increased hiring and implementing safety measures to restricting luxury or unessential products sales.
Another interesting market worth reviewing is the US electronics and household appliances.
Trying to limit the spread of the novel coronavirus, many US companies have transitioned to remote work, with their employees working from the safety of their own homes. On the other end, many people have found themselves without a job or on an indefinite furlough. Both ends of this COVID-19 affected spectrum have shown an interest (or a need) in electronics.
For instance, let’s take a look into the Wireless Headphones market segment. This multi-billion market segment is a prime example of the consumer shifts we have been talking about.
Just looking at the month of March, we can clearly see the surge in demand for headphones as people were building and updating their home offices (or simply looking for some peace and quiet) –
During late February and early March, the unprecedented high sales and the inability of retailers to keep up with demand increased consumer dissatisfaction. This is evident in the sharp drop in sentiment (from over 60% to only 30% positive sentiment), accompanied by an almost double review volume.
These are tumultuous times, and as we have shown, even the biggest names in online retail are feeling it. Like many of us, eCommerce giants like Amazon, Walmart, Target, and BestBuy had to adjust and react to the ever evolving COVID-19 crisis.
Perhaps the best thing you can do to help your business during this global economic crisis is staying informed and connected to what is happening.
The best for you to know what is going on on the market is by listening to your customers. Extracting and using consumer insights, analyzing sentiment, and tapping into the voice of customer will provide you vital information about how your customers are feeling, and what you can do to help them and your business through these difficult times.