Amazon is the Walmart of the Web
No doubt about it, Amazon is the Walmart of the online retail space. They grew 38% this year up from $10B to $14.8B in the last year. Few companies outside of Walmart in the ’80’s have seen this kind of growth. Amazon built on it’s mix with books, cds, dvds, and is continually perfecting it’s model. Now they’re getting into office supplies.
Why? Interestingly, 3 of the top 10 eRetailers are office supply stores (Staples, Office Max and Office Depot). Crazy. The Web accounts for 37% of all office supply sales. So basically, when you go to an office supply store you’re walking through a future graveyard.
According to the publisher of InternetRetailer, the other large segments are all up for grabs. The chain stores are coming back online with renewed seriousness, but their not going to dominate the business sectors. In fact, the chains are growing at the slowest rate, 18% overall vs. catalogers which grew 33%. Pure plays came in at 22%, and branded manufactures at 22%.
Walmart is starting to heavily invest resources into their online business. They grew grew 25% last year, but on much smaller base than Amazon. So far overall online retail sales are down 11% for 1st Q’08. We shall see!