Walmart this morning announced a new partnership with e-commerce shopping platform, Shopify, now used by over 1 million businesses.
The deal will open Walmart’s Marketplace to Shopify’s small business sellers, with the goal of bringing 1,200 Shopify sellers to the marketplace this year. The partnership will greatly expand the reach of the participating brands by placing them in front of Walmart Marketplace’s 120 million monthly visitors.
The partnership is a direct shot at Amazon, which today promises third-party sellers the ability to reach more than 300 million customers worldwide and even offers help with shipping, returns, and customer service by way of Fulfillment by Amazon.
Walmart, meanwhile, has been steadily working to make its own marketplace a more competitive offering. In fall 2018, for example, the retailer announced Walmart Marketplace items would be able to participate in its free, two-day shipping program and would be eligible for in-store returns. Today, Walmart describes its Marketplace’s growth as a “strategic priority.”
The partnership arrives at a time when the coronavirus pandemic has sent record numbers of consumers to shop online. Walmart notes its own U.S. e-commerce business grew 74% last quarter, due to the surge in pandemic-fueled shopping, which sent shoppers online for essentials like food, cleaning products and more. Walmart’s Marketplace business’s growth even outpaced the overall business, despite the strength of its first-party sales.
“We’re excited to be able offer customers an expanded assortment while also giving small businesses access to the surging traffic on Walmart.com,” said Jeff Clementz, vice president, Walmart Marketplace, in an announcement. “Shopify powers a dynamic portfolio of third-party sellers who are interested in growing their business through new, trusted channels. This integration will allow approved Shopify sellers to seamlessly list their items on Walmart.com, which gives Walmart customers access to a broader assortment,” he added.
With the launch of the Shopify integration, Walmart’s focus will be on those brands that can meet its shoppers’ needs. Specifically, Walmart says it will look for U.S.-based small and medium-sized businesses with an assortment that complements Walmart’s own, and that have a good track record in terms of customer service.
Shopify sellers are being invited to install the Walmart Marketplace app from Shopify’s App Store and determine their eligibility. If approved, the sellers can then add an unlimited number of products to Walmart Marketplace, while making changes to product images and inventory within Shopify. Those changes will immediately and automatically be reflected on Walmart’s site, the retailer says.
This sort of integration could be the first step in a potential Shopify acquisition further down the road — an idea that has often been floated as to how Walmart could better compete with Amazon’s dominance. But in the near-term, it turns Shopify’s seller network from one that rivals Walmart’s Marketplace to one that now fuels it.
Over time, this can boost Walmart’s bottom line as it will benefit not only from marketplace listing fees but also from the increased traffic and sales that marketplace items will bring.