Should Your Brand Sell on Walmart Marketplace?

Ryan Faist

Ryan Faist, Channel Key

November 27, 2020

This blog was updated on March 14, 2024.

To sell on Walmart Marketplace or not – that is the question for many brands that currently sell on Amazon. Describing itself as the world’s largest omnichannel retailer, Walmart’s online platform has expanded considerably over the years. According to Statista, around 150,00 sellers have joined Walmart Marketplace. This is only a fraction of Amazon’s 2.5+ million active sellers, but Walmart’s well-established base of more than 265 million customers give Walmart Marketplace the potential to become a competitor. Below Channel Key highlights the key similarities and differences between the two platforms to help you decide whether Walmart Marketplace is a good ecommerce channel for your brand.

Walmart Marketplace Overview

Walmart Marketplace is like Amazon in several ways. Sellers undergo an approval process, onboard their listings, choose a fulfillment option, utilize marketplace marketing and advertising programs, and get paid. Within this basic structure, however, there are several key differences. First, qualifying to become a Walmart Marketplace seller can be challenging. While Amazon allows just about anyone to open a digital storefront, Walmart is selective about the brands they choose to sell under its name. Until 2016, Walmart Marketplace was an invitation-only platform. Today, any brand can apply, but they will need to need to demonstrate a history of ecommerce experience on other platforms, reputable customer service, a compelling product assortment, and competitive pricing before being approved.

Walmart Marketplace offers several fulfillment options. Like Amazon’s Fulfilled by Merchant (FBM) program, sellers can opt to self-fulfill orders (upon qualification) through its Seller Center platform. Walmart Marketplace FBM sellers can display the “Free Two-Day Delivery” label on their approved listings, which is a core component to the retailer’s strategy against Amazon. Thanks to the latter, one-day and two-day shipping are now factored into the customer’s purchasing decision.

Walmart seems to acknowledge the new standards set by Amazon. In February of 2020, they introduced Walmart Fulfillment Services (WFS). Like Amazon’s Fulfillment by Amazon (FBA) option, WFS sellers store their inventory at Walmart fulfillment centers. When a customer places an order on Walmart.com, WFS picks, packs, and ships the item(s) on the seller’s behalf. WFS also handles all customer support and returns for these orders. The WFS end-to-end fulfillment experience comes with access to Walmart’s omnichannel capabilities such as its Free & Easy Returns program. Approved items will display the Free Two-Day Delivery and Fulfilled by Walmart tags for increased product visibility and improved conversion. Like FBA, the WFS cost structure includes a fixed monthly storage fee and a fulfillment price that is based on the item weight.

Unlike Amazon, Walmart Marketplace has partnered with a 3rd party fulfillment service to provide sellers with another option. Sellers can choose to fulfill orders through Deliverr, an ecommerce logistics service that integrates directly with Walmart Marketplace and provides pre-approved access to Free Two-Day Delivery.

Walmart+ vs. Amazon Prime

Walmart and Amazon both offer subscription-based services that provide various benefits and perks to members. Launched in 2007, Amazon Prime boasts more than 230 million subscribers and is one of the most popular and appealing features of the Amazon platform. To counter, Walmart launched its own membership service called Walmart+ in September of 2020. Still in its early years, Walmart+ is designed to provide similar benefits to the retail giant’s loyal base of customers that it has been growing for the past half a century. Below are the basic similarities and differences between the two membership programs.

Key Distinctions Between Walmart Marketplace and Amazon

The primary selling point of joining Walmart Marketplace is gaining access to its established network of locations and customers. In addition to 11,500 brick-and-mortar stores frequented by 265 million customers each year, more than 4o0 million people visit Walmart.com each month (according to their data). This is about half of Amazon’s monthly search traffic. To compensate for this disadvantage, Walmart emphasizes other key distinctions that may be attractive to sellers:

  • LESS COMPETITION With far less seller competition than Amazon, it can be much easier to stand out, gain brand exposure, build trust and authority, gain new leads, and convert sales on Walmart Marketplace.
  • NO INVENTORY LIMITATIONS Unlike Amazon FBA, there are no SKU minimums or maximums with WFS, so you can list your entire catalog of eligible items on Walmart Marketplace or manage limited inventory with a fixed threshold setting.
  • SIMPLE FEE STRUCTURE Walmart Marketplace provides a simpler fee structure than Amazon. The platform simply deducts a referral fee once a sale occurs (no setup, subscription, or monthly fees).
  • EFFICIENT RETURNS AND CUSTOMER SERVICE Nine out of ten Americans live within 15 minutes of a Walmart store, which makes returns and customer service easy by leveraging the retail giant’s existing capabilities in its brick-and-mortar network.

CHANNEL KEY TAKEAWAY

There is no magic formula to determine whether your brand should sell on Walmart Marketplace. While the platform has been around for more than a decade, it is still in its early stages. From a seller’s point-of-view, this provides both advantages and disadvantages when comparing it to Amazon. With only around 150,000 current sellers, it’s much easier to generate traffic to your listings than a platform with 2.5+ million competitors. On the other hand, its marketing and advertising capabilities are quite limited. Amazon has a much larger collection of consumer shopping data that it has used with the help of advanced technology to develop an increasingly expansive arsenal of tools to help sellers target customers. Regardless, one thing is certain: Walmart is aggressively ramping up efforts to compete with Amazon. Channel Key predicts the rivalry between the two online retailers will further intensify as Walmart explores every opportunity to establish itself as a convenient and valuable e-commerce platform for both sellers and customers.

Mastering Amazon Ads 2024 Ebook

Let us send you our free ebook

Mastering Amazon Ads: How to Unlock Explosive Sales Growth

Recent Posts

Amazon Pets landing page.

Account Management

How to Sell Pet Products on Amazon

Read More
Amazon boxes in a living room background.

Account Management

The Definitive Guide to Prime Day Marketing & Advertising

Read More
Amazon add to cart button.

Inventory & Orders

How to Maximize Sales with Amazon Virtual Product Bundles

Read More
Abstract logistics matrix with arrows and dots.

Account Management

Amazon FBA Fee Changes Clarified: How to Minimize Your Costs

Read More
Illustration of Amazon's new Coupons dashboard.

Account Management

Amazon’s New Coupons Dashboard Offers Better Targeting Capabilities

Read More
Collage of Prime Video original shows and movies.

Account Management

How to Set Up Amazon Prime Video Ads and Reach Millions of Viewers

Read More

Channel Key News

Channel Key Acquires True Hero

Read More
Small shopping cart on top of a laptop keyboard.

Account Management

The 2023 Holiday Shopping Season Recap: Top Takeaways for Ecommerce Brands

Read More
Flatscreen television on a desk with a blue background.

Amazon Advertising

Amazon Sponsored TV Ads Reach Upper Funnel Audiences

Read More

Copyright 2023 Channel Key, LLC. All Rights Reserved

Channel Key is excited to announce the acquisition of True Hero, a full-service Amazon marketing agency.

LEARN MORE