Walmart Continues Its Challenge of Amazon
Walmart jumps into voice ordering
Walmart (WMT) has partnered with Alphabet’s (GOOGL) Google to support voice ordering through its e-commerce platform. Walmart customers can simply say what they want to order, and the item will be delivered to them.
Google will back the technology that enables voice ordering on Walmart.com. Customers can place their voice-based orders via Google Home, Google’s smart speaker that rivals Amazon’s (AMZN) Echo device.
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Matching Amazon’s moves
Walmart’s voice ordering move takes its competition with Amazon to another level. Amazon shoppers can already order items via Amazon.com by simply speaking their voice commands via Echo, a smart speaker powered by the Alexa virtual assistant.
Walmart has taken these steps to match Amazon in several ways, as competition between the two retail giants continues to heat up. Amazon is acquiring Whole Foods (WFM) for $13.7 billion to support its speedy expansion into the grocery sector.
Walmart relies on grocery sales for a substantial portion of its revenues. Other traditional retailers such as Costco (COST) and Kroger (KR) are also strong players in the US (SPY) grocery sector, as shown in the chart above.
Amazon’s $20 billion revenue opportunity at risk
Voice ordering could help Walmart speed up the fulfillment of grocery purchases as Amazon threatens to break into its turf.
For Amazon, Walmart’s partnership with Google for voice ordering threatens a potentially lucrative revenue opportunity. RBC Capital Markets analysts projected earlier this year that Amazon could generate more than $20 billion in new revenues by 2020 via voice shopping and sales of Alexa-based products and services.