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Walmart Receiving a beating from Amazon.com, Inc. (NASDAQ:AMZN) on the Online Side of Business

Boston, MA 09/08/2014 (wallstreetpr) – Amazon.com, Inc. (NASDAQ:AMZN) goes without saying is the king of online transactions and with modern shopping patterns shifting to online, Wal-Mart Stores, Inc. (NYSE:WMT) will have to do a lot if it is to capture a sizeable amount of share from Amazon. Total amount of traffic seems to be the biggest challenge facing Wal-Mart according to 24/7 Wall Street.

Walmart Struggling on Online Traffic

The biggest concern that Wal-Mart management will have to address on the company’s online business is the fact that its traffic is not even half that of Amazon.com, Inc. (NASDAQ:AMZN).  With the traffic to brick and Mortar stores on a constant decline, Wal-Mart Stores, Inc. (NYSE:WMT) will need to look for an urgent remedy for the standoff. Amazon is set to grow even further online, compared to Wal-Mart as it continues to make a push for home service delivery using drones that are expected to be more exciting and attractive to customers shopping online.

ComScore research data on the amount of traffic between major shopping retailers casts further doubt on the ability of Walmart to compete hand in hand against Amazon. According to July data, Amazon.com, Inc. (NASDAQ:AMZN) had 94.5 million unique visitors compared to Walmart’s 34.1 million, representing less than half of the former. Wal-Mart Stores, Inc. (NYSE:WMT) needs to address the fact that on its $420 billion annual sales, less than 5% come from online transactions.

 Impact of Lack of Unique Products

Amazon.com, Inc. (NASDAQ:AMZN) is currently being faulted’ for having thin margins on its business but in reality; the company has been using its cash balance on research and Development as well as expansion. Wal-mart on its part needs to do a lot to address the fact that its same stores sales have been performing dismally compared to Amazon’s which have risen over the same period by 20%

Walmart’s poor performance on online transactions can also be attributed to the fact that this is not its core business as compared to Amazon.com, Inc. (NASDAQ:AMZN). Walmart also has a disadvantage on the fact that it does not have unique products such as Kindle Fire tablet as well as Fire phone that continue to contribute a big chunk of Amazon Sales.

Published by Alan Masterson

Alan has over 25 years of trading experience in the U.S. equity markets. He began his career in finance working on a program trading desk specializing in over-the-counter stocks. His career progressed from that point to his current position as senior trader on an institutional trading desk. In the evenings, Alan teaches economics at a local community college. He has contributed articles to various publications over the last six years, including feature articles for an economics magazine and various financial blogs. You may contact Alan via his email ([email protected]) or his Google+ page (https://plus.google.com/103338576216002376250).

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