Amazon and Walmart run both retail business models. In contrast, Amazon started as a digital player, then expanded into the physical world, and Walmart instead successfully launched its e-commerce platform over the years.
While Amazon and Walmart are direct competitors in retail and now also e-commerce, at the core, the companies are pretty similar (both target variety and convenience, while Amazon obsesses over customer experience); in reality, Amazon is a company with many moving parts.
Indeed, by 2022, Amazon had various moving parts, such as advertising, and AWS.
Walmart (also building a successful e-commerce operation) has remained focused on its core business.
|Business Model Element||Amazon||Walmart||Similarities||Differences||Competitive Advantage|
|Customer Segments||Online shoppers, cloud computing clients, e-book readers||In-store shoppers, e-commerce customers, grocery shoppers||Both target a wide range of customer segments, including online shoppers. Amazon has a cloud computing division. Walmart has a strong presence in physical retail and grocery.||Amazon’s significant focus on e-commerce and cloud computing. Walmart’s extensive network of physical stores and emphasis on traditional retail and grocery.||E-commerce Dominance (Amazon), Extensive Physical Retail Presence (Walmart).|
|Value Proposition||Convenience, vast product selection, Prime membership benefits||Low prices, one-stop shopping, physical store presence||Both emphasize convenience and value. Amazon offers a vast product selection and Prime membership benefits. Walmart’s value proposition centers around low prices and one-stop shopping.||Amazon’s online convenience and vast product selection. Walmart’s focus on affordability and a significant physical store presence.||E-commerce Convenience (Amazon), Everyday Low Prices (Walmart).|
|Channels||Online platform, third-party sellers, Prime membership||Physical stores, e-commerce website, online grocery ordering||Both use online platforms for sales. Amazon allows third-party sellers on its platform. Walmart operates physical stores and has an e-commerce website.||Amazon’s exclusive online presence and third-party seller platform. Walmart’s extensive network of physical stores and its expansion into online grocery ordering.||Extensive Online Presence (Amazon), Physical Retail Footprint (Walmart).|
|Customer Relationships||Digital interactions, customer reviews, Prime membership benefits||In-store interactions, loyalty programs, customer service||Both maintain customer relationships through digital interactions. Amazon relies on customer reviews and Prime membership benefits. Walmart fosters in-store interactions, loyalty programs, and customer service.||Amazon’s focus on digital customer interactions and reliance on Prime membership. Walmart’s emphasis on in-store relationships and traditional customer service.||Digital Engagement (Amazon), In-Store Relationships (Walmart).|
|Key Activities||E-commerce operations, cloud computing, content creation||Retail operations, supply chain management, private label brands||Both engage in e-commerce operations. Amazon has a cloud computing division and content creation (e.g., Amazon Studios). Walmart focuses on retail operations, supply chain management, and private label brands.||Amazon’s diversification into cloud computing and content creation. Walmart’s core focus on traditional retail and supply chain management.||Cloud Computing and Content Creation (Amazon), Traditional Retail Expertise (Walmart).|
|Key Resources||E-commerce platform, data centers, content libraries||Physical stores, supply chain infrastructure, private label brands||Both rely on e-commerce platforms. Amazon has data centers and content libraries. Walmart’s key resources include physical stores, supply chain infrastructure, and private label brands.||Amazon’s emphasis on digital resources, data centers, and content libraries. Walmart’s reliance on physical retail assets, extensive supply chain, and private label brands.||Digital Resources (Amazon), Physical Retail Assets (Walmart).|
|Key Partnerships||Third-party sellers, content creators, delivery services||Suppliers, technology partners, delivery and logistics providers||Both collaborate with third-party sellers and delivery services. Amazon partners with content creators. Walmart collaborates with suppliers, technology partners, and logistics providers.||Amazon’s partnerships with content creators and its broader range of technology collaborations. Walmart’s focus on supplier relationships and logistics partnerships.||Content Creation Partnerships (Amazon), Strong Supplier Relationships (Walmart).|
|Revenue Streams||Product sales, subscription services, advertising||Product sales, in-store services, advertising||Both generate revenue through product sales and advertising. Amazon has subscription services (e.g., Prime). Walmart offers in-store services in addition to product sales.||Amazon’s diverse revenue streams, including subscription services and advertising. Walmart’s primary revenue source is product sales, both in-store and online.||Subscription Services (Amazon), In-Store Service Offerings (Walmart).|
|Cost Structure||Fulfillment and shipping costs, technology development expenses||Supply chain and operational costs, employee wages||Both manage costs related to fulfillment and technology. Amazon incurs significant costs for fulfillment and technology development. Walmart focuses on supply chain and operational costs.||Amazon’s higher technology development expenses and investment in fulfillment and shipping. Walmart’s cost structure centered around supply chain efficiency and employee wages.||Technology Investment (Amazon), Supply Chain Efficiency (Walmart).|
Connected to Amazon Business Model