Marketplace Briefing: Walmart Marketplace sees record sales during Black Friday-Cyber Monday amid online shopping boom

Walmart Marketplace’s sales record comes just after the retailer reported robust earnings driven by substantial online sales growth. During its most recent quarter, that side of the business grew 22% year over year, with Walmart Marketplace sales increasing 43%, marking the fifth quarter in a row with more than 30% sales growth.

“Walmart is a sleeping giant,” said Jon Elder, CEO and founder at Black Label Advisor, which manages hundreds of brands. Brand owners who have launched on Walmart Marketplace are seeing an average of 15% of their total Amazon sales, up from 10% last year, Elder added, citing client portfolio data. “They’re growing wicked fast.” 

Elder isn’t alone.

Pattern, an e-commerce accelerator, said its brands saw “double-digit growth” during the Black Friday and Cyber Monday period on Walmart Marketplace compared to last year, according to George Hatch, director of marketplaces at Pattern.

Brands are increasingly prioritizing Walmart Marketplace as a platform to grow their sales, according to Hatch. “With the growth of Walmart Marketplace being the second largest U.S. e-commerce marketplace, we’ve seen a lot of brands that have really changed their perception, that have realized that they have to be there,” he said.

E-commerce is a major focus at Walmart. In November, John Rainey, Walmart’s chief financial officer, told analysts on the company’s third-quarter earnings call that e-commerce sales made up 18% of overall sales during the third quarter, up from 15% compared to the year-ago period. Given that Walmart raked in $169.6 billion in revenue overall, the retailer earned $30.5 billion from online sales. 

Walmart Marketplace, in particular, is a key driver of the company’s overall online sales growth. In the third quarter, the company said the number of sellers on the platform is growing by double digits, and its marketplace SKU count has nearly reached 700 million items. As of September, Walmart Marketplace has around 150,000 sellers on its platform, per estimates from Marketplace Pulse.

By comparison, Amazon earned $61 billion in e-commerce sales during the third quarter, double that of Walmart’s. But Walmart’s online sales are growing at a faster clip than Amazon’s. While Walmart’s e-commerce business grew 27% in the third quarter, Amazon’s only grew 7%. 

Walmart’s third-party marketplace has been around since 2009, but it didn’t start to become a bigger focus until 2020 when Walmart introduced a fulfillment service for merchants. Walmart has increasingly added more services to attract more sellers and make it easier for them to sell on the platform. The retailer has also expanded its product categories to include premium beauty, pre-owned goods and collectibles, Modern Retail previously reported. 

“Walmart is not anywhere near matching Amazon in terms of the huge product catalog and the number of sellers that Amazon has,” said Brad Jashinsky, director analyst at Gartner. “But they’re making some really great strides, and I think that’s what’s driving a lot of the performance that we’re seeing.”

Speaking at Morgan Stanley’s Global Consumer and Retail conference in New York on Tuesday, Walmart’s CEO Doug McMillon acknowledged the growing pains of the retailer’s third-party marketplace.

“We didn’t know what the e-commerce model was going to look like today. We just knew customers wanted it, and it was painful to go through all those investments,” McMillon said. “It’s nascent, but it’s got momentum.”

E-commerce, in general, is booming 

Walmart isn’t the only one having a busy holiday season. 

Below is a breakdown of what other e-commerce platforms and agencies reported after the Black Friday/Cyber Monday bonanza.

Amazon:

• On Tuesday, Amazon said it saw record sales during its 12-day holiday sales event, which ran from Nov. 21 to Dec. 2. While the e-commerce giant did not disclose specific sales figures, it said the shopping event was its biggest ever.
• Amazon also said that it sold a record number of items during the period ending on Cyber Monday. More than 60% of Amazon’s sales during the event came from third-party sellers.
• Amazon brands, on average, saw a nearly 8% year-over-year growth during Black Friday, according to client portfolio data from Envision Horizons, a consulting agency that works with online sellers. 

Shopify:

• Shopify, which powers e-commerce stores for brands, reported that its merchants hit a record-breaking $11.5 billion in global sales during the Black Friday and Cyber Monday shopping period, a 24% increase from the same period a year ago. 
• More than 76 million shoppers bought something from a Shopify merchant during the Black Friday and Cyber Money period.

TikTok Shop:

• TikTok Shop, which has been pushing livestreams this holiday season, drove more than $100 million in U.S. sales on Black Friday.
• Stormi Steele, founder and CEO of Canvas Beauty, sold more than $2 million in goods in a single livestream on TikTok Shop on Black Friday. 
• End-to-end logistics company Flexport, which integrated with more than 50 e-commerce platforms, said its customers doubled their growth in TikTok Shop orders compared to the same year-ago period, a Flexport spokesperson told Modern Retail.

Shein/Temu:

• Shein Marketplace orders also nearly tripled year over year, according to Flexport merchant data.
• Temu saw average spend per user increase by nearly 20% year over year, as well as its total shoppers jump by nearly 40%, according to financial health app Brigit.

These records are the latest indication that consumers are turning to online shopping more than ever. Although Black Friday is historically a holiday that brings shoppers into brick-and-mortar stores, more than half of consumers did most of their shopping online this year, according to market research firm Numerator.

Adobe initially forecasted U.S. sales on Cyber Monday at $13.2 billion, but the figure came in a bit higher at $13.3 billion. Black Friday sales in the U.S. were $2.4 billion less at $10.8 billion, per Adobe. 

As online shopping continues to gain momentum, especially during peak holiday shopping periods like Cyber Monday and Black Friday, the stakes will be high for retailers like Walmart to stand out in a landscape crowded with competitors. 

“For years we’ve seen online shopping growth really just translate into Amazon shopping growth,” Jashinsky said. “Now we’re starting to see that distributed a little bit more to other players out there.”

Marketplace news to know

• ThredUp has divested its Europe resale business, Remix. The company said it is focused on growth in the U.S.
• Amazon unveiled a new set of AI models that are part of its Bedrock library.
• Boeing expects express e-commerce shipments to account for a quarter of all air cargo business by 2043.

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