Why isn't Wal-Mart walloping Amazon?

The discount chain is competitive on prices, but more of its customers are still turning to the online retailer.

By Kim Peterson Jun 22, 2012 12:27PM
Walmart © Bloomberg/Getty ImagesIf you're shopping for a DVD -- say, the first season of "Glee" -- would you find a better price at Amazon (AMZN) or Wal-Mart (WMT)?

Many of us would say Amazon, but Wal-Mart offered a better deal Friday on that DVD, both in its stores and on its website. Amazon charged $26.87 for the disc set, while Wal-Mart charged $24.96.

In fact, Wal-Mart beats Amazon time and time again on pricing, a study by research the firm Kantar Retail found. But Wal-Mart doesn't advertise this fact at all, and more of its customers are jumping to Amazon all the time.

Amazon has a well-deserved reputation for beating on price. Wal-Mart can compete tooth and nail at this level, however, because it has spent decades perfecting its warehousing, distribution and supply-chain management. It's also notorious for bullying manufacturers into rock-bottom prices.

Kantar compared prices on 36 items and found that Wal-Mart is about 20% cheaper, on average, Bloomberg reports. The difference was starker on food, where Amazon's prices were nearly 60% higher.

But Kantar looked at only 36 items. Amazon beats Wal-Mart on many, many others, and shoppers know that. Other studies have found Amazon to be lower than Wal-Mart, particularly because it doesn't charge sales tax in many states. Still, Wal-Mart seems to be competing more aggressively with its online rival.

Why doesn't Wal-Mart do more to advertise its price advantage? Why isn't Wal-Mart shouting from the rooftops, "Hey, all you Amazon shoppers, check us out for a change!"

It doesn't want to. "We'll leave it to Kantar to talk about prices," spokesman David Tovar told Bloomberg.

Meanwhile, more of Wal-Mart's customers are discovering Amazon. Only 25% of Wal-Mart's customers shopped at Amazon five years ago, Bloomberg reports, but that's now up to 50%.

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8Comments
Jun 22, 2012 1:02PM
Jun 23, 2012 10:04AM
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Why Amazon instead of Wal-Mart? Maybe because I'm a techie Boomer and shop more like my Millennial friends, not like my parents. I LOATHE Wal-Mart. Outside of groceries (I go to a local chain with superb produce and great customer svc), I shop as much as possible on-line. I haven't walked into a shopping mall in decades and don't plan to do so any time soon! LOVE Amazon's Marketplace and Prime membership - why waste gas when I can have it sent to my door in 2 days?
Jun 23, 2012 12:07PM
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Amazon.com is still the winner since you don't have to pay for shipping or taxes on products. So the Glee DVD would still be cheaper with Amazon.com since you don't have to add sales tax or shipping. 
Jun 22, 2012 2:03PM
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Walmart Sucks! - Amazon the store of the future!

Amazon you can compare multiple products, read customer reviews and you don't have to listen to some skank complaining she hasn't gotten her cigarette break while waiting in some never ending line for 30 minutes - So what if it costs a dollar extra? It's worth it! Does that answer your question Walmart? And this article is misleading - get a free app from amazon and compare prices for yourself.

Oh and if you do go with Walmart more than likely the price will be more when you check out, they are notorious for jacking up the prices hoping you will not catch their "mistake"

Jun 23, 2012 11:27AM
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Wait til all states Tax Amazon. That's the decider.
Jun 26, 2012 5:42PM
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Simple...Walmart has nothing but junk merchandise and poor customer service. You can buy nice items on Amazon and they have great customer service.
Jun 22, 2012 10:41PM
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Hi, Wal-Mart   is alot cheaper than Amazon, my Mom use to say if you are really good you do not have to tell people , other people will say it for you!
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