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Walmart (NYSE: WMT) retaliated against Amazon (NASDAQ: AMZN) in recent years, expanding its e-commerce ecosystem, offering new free delivery, delivery and support options, and transforming its physical stores into distribution centers.
Yet Walmart lacked two of Amazon's assets: Amazon Prime, which locks users with a growing list of benefits, and Alexa, which connects consumers to its services with voice searches. However, Walmart's new partnership with Alphabetof (NASDAQ: GOOG) (NASDAQ: GOOGL) Google could help her counter Alexa.
Source of the image: Getty Images.
Walmart recently announced that it would let buyers buy products via Google Assistant, which works on Google Home devices, set-top boxes, Android devices and even iPhones. Buyers can add products to their baskets by saying, "Hey, Google, talk to Walmart." Could this partnership help Walmart and Google counter Alexa?
How does this agreement help Walmart?
The e-commerce expansion of Walmart, which includes the addition of new products in its online stores, prices equivalent to Amazon prices and the acquisition of a long list of numerically native brands – increased e-commerce revenues in the United States by 40% in fiscal 2019. This figure is expected to increase by 35% in fiscal year 2020, which began on January 31st.
Walmart's e-commerce revenues represent a small percentage of its total sales and eMarketer expects it to control less than 5% of the US e-commerce market this year, compared to 47% for Amazon.
However, Walmart's digital business remains relevant to its brand, attracts third-party vendors that expand its online product line, and helps it grow into new generation markets such as deliveries without driver and voice purchases. The attachment of its e-commerce platform to Google Assistant, now available on more than one billion devices worldwide, clearly complements this strategy. Alexa's Amazon only works on about 100 million devices.
How this agreement helps Google
Google dominates the online search market, but has repeatedly failed to break into the e-commerce market. Its main e-commerce platform is Google Express, which executes orders from third-party retailers such as Target and Costco.
Google Express went astray when major retailers launched their own delivery and support options. Its number of participating retailers declined after its launch in 2013 and struggled to keep its contract mail services on the same page. Last year, Gizmodo Bryan Menegus lamented that the fragmented and confusing ecosystem of Google Express makes it an "enriched payment processor" instead of an "Amazon killer".
However, the robust sales of Google Home, which competes with Amazon Echo, could give the company a second chance in the e-commerce market. eMarketer expects Google Home's share of the US smart speaker market to increase from 29.5% in 2018 to 31% in 2019. Amazon's share is expected to increase from 66.6% % to 63.3%.
Source of the image: Google.
eMarketer estimates that the total number of people using smart speakers in the United States will increase by 15% to 74.2 million this year, and more than a quarter of US adults will use it at least once a month. Here the end of the year. Linking Walmart's e-commerce platform with Google Assistant could help both companies gain a foothold in the nascent voice mail service market.
A small but growing market
The partnership between Walmart and Google is strategic, but most smart speaker users are not yet using devices to shop. Last August, L & # 39; information claimed that only 2% of Alexa-compatible devices used voice-activated purchase features.
However, buying habits continue to evolve. Amazon said that the voice purchased on Alexa "had more than tripled" during the holiday season last year. In February, a Adobe The survey found that 26% of respondents had purchased products or placed orders with their smart speakers.
These figures indicate that Walmart could eventually reach more buyers than Amazon through voice searches because Google Assistant runs on more devices than Alexa. If Walmart succeeds its foray into distance selling, other retailers (including those who have abandoned Google Express) could again consider joining the technology giant.
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