In the competitive world of e-commerce, choosing between Walmart Marketplace vs. Amazon is a critical decision for sellers. Both platforms dominate the online marketplace, offering unique benefits and challenges. Understanding the differences between Walmart Marketplace and Amazon can help sellers maximize their profits and reach the right audience. This guide explores the pros and cons of each platform to help you make an informed decision.
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Understanding Walmart Marketplace and Amazon
Before comparing the two, it’s important to understand what makes each platform distinct in the e-commerce landscape.
Amazon: The Global E-Commerce Powerhouse
Amazon, founded by Jeff Bezos in 1994, started as an online bookstore and rapidly expanded into a massive e-commerce ecosystem. Today, it’s known as “the everything store,“ offering millions of products across countless categories. The company has built its reputation on a customer-centric approach, fast delivery times, and innovative seller services like Fulfillment by Amazon (FBA).
For sellers, Amazon represents an opportunity to reach a global audience and benefit from robust advertising tools, streamlined logistics, and an established brand reputation. However, this wide reach also means dealing with intense competition, high seller fees, and strict policies.
Walmart Marketplace: A Growing Alternative
Walmart, a retail giant since 1962, launched Walmart Marketplace in 2009 to compete in the digital space. Unlike Amazon, which allows almost anyone to sell, Walmart carefully vets its third-party sellers, ensuring only qualified businesses can list products on the platform. This selective approval process creates a less saturated market, which can be advantageous for sellers looking to avoid intense competition.
Walmart’s omnichannel approach integrates online and in-store shopping, offering options like in-store pickup and curbside delivery, making it a strong alternative for brands that want to expand their presence beyond digital marketplaces.
Pros and Cons of Selling on Amazon
Selling on Amazon offers enormous benefits, but it also comes with challenges that sellers must navigate.
Pros of Selling on Amazon
1. Unmatched Customer Base and Traffic
Amazon has over 300 million active users worldwide, making it the most visited e-commerce platform. This massive audience means sellers can reach millions of potential customers without spending a fortune on advertising. Unlike Walmart, Amazon is often the go-to online shopping destination for consumers searching for a wide range of products.
2. Fulfillment by Amazon (FBA) Simplifies Logistics
One of Amazon’s most attractive features is FBA (Fulfillment by Amazon). This service allows sellers to store their products in Amazon’s warehouses, where Amazon handles storage, packaging, shipping, and even customer service. FBA ensures faster delivery, especially for Prime members, which can significantly boost conversions.
However, FBA comes with storage fees and fulfillment costs, which can cut into profit margins. Sellers must carefully assess whether the convenience is worth the additional expenses.
3. Advanced Advertising and Marketing Tools
Amazon provides a range of advertising options, including Sponsored Products, Sponsored Brands, and Amazon DSP (Demand-Side Platform). These tools help sellers improve product visibility and drive traffic to their listings.
Amazon’s algorithm favors paid promotions, meaning sellers often have to invest in ads to stay competitive. While these tools can increase sales, they also require continuous investment, making it necessary for sellers to balance their ad spend with profitability.
4. Strong Brand Trust and Global Recognition
Amazon’s reputation as a trusted online marketplace can enhance consumer confidence in a seller’s products. Many shoppers are more willing to purchase from Amazon’s marketplace rather than an independent website because of the platform’s buyer protection policies, fast shipping, and easy returns.
Cons of Selling on Amazon
1. Intense Competition and Price Wars
With millions of sellers competing in the same marketplace, price wars are common. Many sellers undercut prices to win the Amazon Buy Box, which can significantly reduce profit margins. To stay competitive, sellers need strong differentiation strategies, such as unique branding or bundling products.
2. High Fees and Commission Costs
Amazon charges multiple fees, including referral fees, storage fees, and fulfillment fees (for FBA sellers). Referral fees typically range between 8%-15% per sale, depending on the category, while FBA fees vary based on product size and weight. Sellers must carefully calculate their costs to ensure profitability.
3. Strict Seller Policies and Risk of Account Suspension
Amazon enforces strict policies on product quality, customer service, and order fulfillment. Sellers who fail to meet these requirements may face account suspension or permanent bans. The appeal process can be complex, making it risky for businesses relying solely on Amazon for sales.
4. Limited Branding Control
Unlike Shopify or independent e-commerce websites, Amazon does not give sellers much control over branding. Product listings must follow Amazon’s standardized format, and competitors can sell the same product under the same listing, making it difficult to create brand differentiation.
Pros and Cons of Selling on Walmart Marketplace
Walmart Marketplace is gaining traction among third-party sellers looking for a less competitive alternative to Amazon.
Pros of Selling on Walmart Marketplace
1. Lower Competition and Higher Product Visibility
Walmart Marketplace has fewer third-party sellers than Amazon, making it easier for businesses to gain visibility. Unlike Amazon, where many categories are oversaturated, Walmart offers less crowded market space, increasing sellers’ chances of making sales without heavy advertising investments.
2. Simple and Transparent Fee Structure
Unlike Amazon, which charges multiple fees, Walmart keeps its pricing simple. Sellers only pay a referral fee on each sale, typically ranging from 6%-15%. There are no monthly subscription fees, making Walmart an attractive option for sellers who want to avoid high operational costs.
3. Walmart’s Growing E-Commerce Presence
Walmart is heavily investing in expanding its online marketplace, improving site functionality, and attracting more online shoppers. As Walmart’s digital footprint grows, sellers who establish themselves early can benefit from the platform’s rising traffic.
4. Omnichannel Selling Opportunities
Unlike Amazon, Walmart integrates its online and offline stores, allowing sellers to offer in-store pickup and curbside delivery. This blended shopping experience caters to a different segment of consumers, giving sellers an additional way to reach customers.
Cons of Selling on Walmart Marketplace
1. Selective Seller Approval Process
Walmart has a rigorous application process for third-party sellers. Unlike Amazon, where almost anyone can sell, Walmart handpicks its sellers to maintain quality control. While this process helps reduce low-quality listings, it can be difficult for new or small businesses to gain approval.
2. Limited Seller Support
Many sellers report that Walmart’s seller support system is less developed than Amazon’s. Issues like account problems, order disputes, or listing errors may take longer to resolve due to slower response times.
3. Fewer Advertising Options
Compared to Amazon’s advanced advertising ecosystem, Walmart’s ad platform is still in its early stages. While Walmart does offer sponsored listings, it lacks the sophistication and targeting options available on Amazon.
Walmart Marketplace vs Amazon: Which Should You Choose?
The choice between Walmart Marketplace vs. Amazon depends on factors like:
- Competition Level – Amazon has more traffic but also more sellers. Walmart offers higher visibility due to lower competition.
- Costs and Fees – Amazon has higher fees, while Walmart has a simpler cost structure.
- Brand Control – Amazon limits custom branding, while Walmart allows more seller control over listings.
- Omnichannel Potential – Walmart’s in-store pickup model creates more selling opportunities.
Walmart WFS vs. Amazon FBA: Which Fulfillment Service is Better?
One of the biggest decisions for e-commerce sellers is choosing the right fulfillment service. Walmart Fulfillment Services (WFS) and Amazon FBA both provide warehousing, packaging, and shipping solutions, but they operate differently.
- Walmart WFS offers lower fulfillment fees and simple pricing, making it a cost-effective choice. However, it requires sellers to be approved on Walmart Marketplace before enrolling.
- Amazon FBA is well-established with a global reach and offers Prime shipping benefits, but it comes with higher storage and fulfillment costs.
For a detailed comparison between Walmart WFS vs. Amazon FBA, read here
Conclusion
Both Amazon and Walmart Marketplace offer unique advantages. Amazon provides unparalleled reach, while Walmart offers lower competition and simpler fees. Choosing the right platform depends on your business goals, product category, and growth strategy.
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Last News
06.03.2025
