Amazon Set to Overtake Walmart in Beauty

According to Business of Fashion, Amazon is set to make up 14.5% of the beauty market by 2025 to become the largest Beauty retailer by 2025, thus overtaking Walmart who are set to own 13% of the market by 2025. Amazon have set their eyes on greater ownership of the beauty category for a number of years now with a combination of mass and luxury brands selling products to consumers.

Due to Amazon’s recognised dominance, I was surprised to hear that they hadn’t already overtaken Walmart who currently own the lion share. When we look to the online space, Amazon are already a clear leader when we compare the two. To quote Forbes “Where one is weak, the other is strong” which has come from a recent article on the two retailers, this means that whilst Amazon have an incredibly strong online retail presence, Walmart are equally as strong offline with 90% of Americans living within 10 miles of a Walmart store.

This trend is driven through the expectation of more consumers purchasing beauty products online which is set to hit 45% by 2025.

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Amazon have long been dominant over Walmart in the online space with Walmart making up a fraction of it’s size for a number of categories. Isolating a popular product type in the Beauty category such as “shampoo”, we can see that Amazon get 5X the amount of traffic to pages related to “shampoo”.

Walmart is still a massive opportunity for a number of brands and there is still room for them to challenge in the online space as it’s a clear area for growth. Based on Amazon’s current dominance, it’s integral for beauty brands to ensure that their Amazon sales channel is optimised and works effectively with future growth.

Joe Farley, Associate Director & Head of Consultancy