walmart v amazon 150726 When the world's No. 1 and No. 2 retailers butt heads, Wall Street pays attention. We may be witnessing a tipping point here but I'm not willing to predict which way the market will fall because the of the bricks-and-mortar vs. shipping costs equation is not yet decided. How the government finally settle the issues surrounding sales tax may be the final straw.
When markets closed on Friday, Amazon had a market cap of $246.54 billion versus Wal-Mart's $230.53 billion cap. Although Wal-Mart's overall sales are much bigger than Amazon's, this unprecedented value swap underscores the fact that the 53-year-old retailer is getting smoked when it comes to ecommerce. In 2014, Wal-Mart's online sales were $12.2 billion compared to Amazon's $89 billion. Even though Amazon has about one-twentieth of Wal-Mart's total scale, its online business is growing faster overall.
Walmart is chasing Amazon on the technology front, but can technology be sufficient for Amazon to triumph?
Forrester Research analyst Sucharita Mulpuru told Business Insider that she expects Wal-Mart will eventually achieve an online shopping experience that's as good as Amazon's, even if it never catches up in dollars spent online. Although it's not uncommon for brick-and-mortar retailers to get 20% of their revenue from online these days, she wouldn't bet on Wal-Mart reaching that level. "I don't think Wal-Mart will hit that because its core customer isn't the most wired or tech savvy shopper out there," she said via email. "But to expect 10% I think would be reasonable."
The digital divide may actually save Walmart. Jeff Hess: Have Coffee Will Write.

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