Walmart Enters an Economic Environment That Plays To Its Strengths
Walmart Enters an Economic Environment That Plays To Its Strengths
* In a time when inflation runs high, focus on value and rollbacks are noticed. Could give them a near-term advantage over Target/Amazon if consumers become more price-sensitive. "Value" is Walmart's middle name.
* Economy in 2022: - Q1 laps stimulus, so near-term headwinds to everyone - Q4 accelerating growth - inflation another headwind but ironically could benefit walmart as an experienced operator with multiple levers (marketplace, ads, fulfillment, stores, international)
- they are used to managing inflation more than other players due to their international exposure.
* Walmart has created this hybrid Target/Amazon business model which gives them some advantages over both in this climate.
* Marketplace and Ads and Walmart Fulfillment Services. WFS making progress. This is increasing their gross margin leverage. This is the part of the business that is more like Amazon.
* WMT Connect active advertiser count grew 130% y/y. Instacart should be worried the giant has woken up.
* Planned 200M in eCom assortment by end of 2022.
* Walmart Marketplace added 20k sellers in 2021. 40k more expected in 2022. Better control fraud and duplication :)
* Walmart store fulfillments increasing. Ship from Store is up 170% y/y on to of 500% previous year. This makes them more like Target. No specific curbside mention.
* Walmart Fulfillment Services. Sams Club now leveraging GoLocal, this is smart.
* Inventory grew 28% y/y - I thought this was interesting.
* Advertising now a $2B business and growing fast. Interesting they released this number. Analysts tried to get them to release WMT+ membership numbers, no dice.
