Introduction
Choosing where to sell online, particularly when it comes to selling on Walmart vs. Amazon, has become one of the highest-stakes decisions for U.S. ecommerce brands. For years, the path was simple: launch on Amazon. But as Amazon becomes more saturated and expensive, Walmart has emerged as a powerhouse alternative, offering surprising advantages for brands that know how to navigate its ecosystem. The reality is, the platform that worked for you yesterday might not be the one that elevates your sales tomorrow.
This isn’t just another comparison. We're digging into the critical differences in seller fees, competition, fulfillment logistics, and advertising ROI to give you a clear-eyed view of where you should be focusing your efforts. What we've found might challenge your assumptions about which marketplace truly delivers higher profits and better visibility for growing brands.
Key Takeaways
Lower Competition: Walmart has ~160,000 sellers vs. Amazon’s millions, offering new brands better visibility and a higher chance of ranking organically.
Higher Profitability: Walmart often has lower fulfillment fees and no monthly subscription fees, making it more cost-effective for testing products and maximizing margins.
Different Audiences: Amazon's Prime members prioritize convenience and selection, while Walmart's customers are more price-sensitive and focused on essentials like groceries and CPG.
Stricter Onboarding: Walmart requires a stricter vetting process (U.S. business, compliance history), creating a more curated and brand-safe environment than Amazon's open-door policy.
Smarter Advertising: Walmart Connect generally offers lower CPCs and higher ROI for advertisers due to less competition compared to Amazon's mature but expensive ad platform.
Walmart vs. Amazon: The Core Differences for Sellers
Deciding between selling on Walmart vs. Amazon is one of the most critical choices for an ecommerce brand today. It's not just about picking another sales channel; it's about understanding two fundamentally different ecosystems, each with its own customers, costs, and rules of engagement. For years, Amazon was the undisputed king, the default starting point for any serious seller. But Walmart has aggressively built out its marketplace, creating a compelling alternative that can no longer be ignored.
The biggest mistake we see brands make? Assuming what works on Amazon can be copied and pasted onto Walmart. This approach almost always fails. Success requires a dedicated strategy tailored to each platform's unique environment. From seller density and fulfillment logistics to advertising ROI and compliance hurdles, the playbooks are worlds apart.
A Tale of Two Marketplaces
Think of it this way: Amazon is like downtown Manhattan—crowded, expensive, and incredibly diverse, with a massive amount of foot traffic. If you can make it there, the potential is huge, but you’re competing with millions of others for a tiny piece of real estate. Walmart, on the other hand, is like a rapidly growing new city center. It's more curated, less congested, and offers a golden opportunity to become a landmark brand before the skyscrapers move in. Understanding this core difference is the first step toward making the right choice for your business.
Seller Competition and Visibility: A Clear Win for Walmart
One of the most compelling arguments for selling on Walmart is the significantly lower level of competition. Amazon’s marketplace is famously saturated. You're not just competing with a few other brands; you're up against literally millions of third-party sellers. This makes gaining organic visibility for new products a monumental, and often expensive, task.
Walmart's numbers tell a different story. While Amazon has over two million active sellers, Walmart's marketplace is home to around 160,000 sellers. This isn't because it's not a valuable platform; it's because Walmart has been far more selective in its approval process, creating a more curated and less chaotic environment. We've seen firsthand how this translates into real-world advantages for emerging brands.
What Less Saturation Means for You
Better Organic Ranking: With fewer sellers vying for the same keywords, your products have a much higher chance of ranking on the first page of search results without a massive ad spend.
Increased Buy Box Ownership: Less competition for a specific product means a higher probability of winning and holding the Buy Box, which is critical for driving sales.
Faster Traction: New brands and products can gain visibility and sales velocity more quickly, creating a positive feedback loop with Walmart's algorithm. For challenger brands trying to carve out a niche, this is a game-changer. It’s an opportunity to build a strong foundation and sales history on a major platform before the competition floods in.
If you're tired of battling for scraps of attention on Amazon, the breathing room on Walmart Marketplace could be the strategic advantage you need. It’s one of the key traps Amazon sellers fall into—underestimating how different the competitive landscape truly is.
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The Hidden Costs: A Breakdown of Seller Fees and Profitability
Profitability on any marketplace boils down to managing your costs. When comparing Amazon and Walmart, the fee structures present a clear trade-off: Amazon’s massive audience comes at a higher price, while Walmart offers a more cost-effective model, particularly for new or growing sellers.
Amazon’s fee schedule is notoriously complex. You start with a Professional Seller account fee of $39.99 per month. Then come referral fees, which typically range from 8% to 15% depending on the category. After that, you have FBA fulfillment fees, storage fees, and a slew of other potential charges that can quickly eat into your margins.
Walmart, by contrast, has a simpler and often cheaper structure. There is no monthly subscription fee. You only pay a referral fee when you make a sale. These fees are competitive with Amazon's, generally falling within the same 8-15% range. This model makes Walmart an incredibly low-risk platform to test new products or diversify your sales channels without committing to fixed monthly costs.
Fee Comparison at a Glance
Here’s a simplified look at how the primary fees stack up:
Fee Type | Amazon | Walmart |
|---|---|---|
Monthly Subscription Fee | $39.99 (Professional) | $0 |
Referral Fees | 8% - 15% (Category Dependent) | 6% - 15% (Category Dependent) |
Fulfillment Fees | Complex structure based on size/weight; subject to frequent increases. | Often 15-25% lower than FBA with a simpler, weight-based structure. |
For brands focused on maximizing margins or operating on a tighter budget, Walmart’s straightforward, pay-as-you-go model presents a significant financial advantage. You keep more of your revenue from each sale, which can be reinvested into growth initiatives like advertising or inventory.
Fulfillment Showdown: Amazon FBA vs. Walmart WFS
A brand’s ability to deliver products quickly and reliably is non-negotiable in modern ecommerce. Both Amazon and Walmart offer their own world-class fulfillment networks: Fulfillment by Amazon (FBA) and Walmart Fulfillment Services (WFS). While FBA has long been the gold standard, WFS has emerged as a powerful and cost-effective competitor.
Amazon FBA is an unrivaled logistics machine. Its sheer scale, speed, and integration with the Prime ecosystem are its biggest strengths. Handing your inventory over to FBA means your products are eligible for Prime shipping, a massive conversion driver. However, this convenience comes with rising costs, complex fee structures, and increasingly restrictive inventory limits that can stifle growth for smaller brands.
Walmart Fulfillment Services (WFS) was built to directly challenge FBA, and it does so effectively on several fronts. It offers brands 2-day shipping nationwide, access to Walmart’s robust supply chain, and trusted customer support. Crucially, WFS often comes with lower costs and a simpler fee structure. As noted by Sequence Commerce, WFS can be 15-25% cheaper than FBA, without the "surprise charges" that often appear on Amazon statements. This makes managing your fulfillment and logistics costs more predictable.
Key Differentiators: WFS vs. FBA
Cost: WFS is generally more affordable, with straightforward pricing based on weight and no separate long-term storage fees for the first 30 days.
Simplicity: Walmart’s fee structure for fulfillment is less convoluted, making it easier for sellers to forecast their expenses and profitability accurately.
Support: Many sellers report a more direct and helpful support experience with WFS, as Walmart is still keenly focused on attracting and retaining high-quality brands to its network.
Inventory Limits: While both have limits, WFS has historically been less restrictive, giving brands more flexibility in how much stock they can send in.
While FBA still has the larger infrastructure, WFS provides a compelling, cost-effective, and reliable alternative that can significantly improve a brand's bottom line. For many, a hybrid approach—using both FBA and WFS—is the smartest way to diversify and optimize logistics.
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Understanding the Shopper: Amazon Prime vs. Walmart+
You can't sell effectively without knowing your audience. While both Amazon and Walmart attract a massive number of shoppers, their core customer bases have distinct characteristics and priorities. Tailoring your product catalog, pricing, and marketing to these differences is essential for growth.
Amazon's audience is largely defined by the Prime member. These shoppers are often more affluent, tech-savvy, and prioritize convenience and speed above all else. They are conditioned to expect one- or two-day shipping and are willing to pay a premium for it. They use Amazon as a search engine for everything, from high-end electronics to everyday essentials, and are loyal to the Prime ecosystem.
Walmart's customer base, both online and in-store, is traditionally more value-driven and price-sensitive. They are experts at finding deals and are heavily focused on categories like groceries, household essentials, and consumer packaged goods (CPG). With its massive physical footprint, Walmart has a unique advantage in omnichannel retail, commanding 31.6% of U.S. online grocery sales compared to Amazon's 22.6%, according to Incrementum Digital. The Walmart+ member is looking for everyday low prices combined with the convenience of delivery.
Customer Profile Comparison
Attribute | Amazon Shopper | Walmart Shopper |
|---|---|---|
Primary Motivation | Convenience, Speed, Selection | Price, Value, Essentials |
Key Demographic | Higher-income, Urban/Suburban | Broader income range, Rural/Suburban |
Top Categories | Electronics, Books, Apparel, Everything | Groceries, CPG, Household Goods, Toys |
Loyalty Program | Prime (Fast Shipping, Video, etc.) | Walmart+ (Free Delivery, Fuel Savings) |
For brands, this means a product that succeeds on Amazon might need different positioning on Walmart. A high-end gadget might fly off the shelves on Amazon, while a family-sized pack of snacks at a great price point will likely perform better on Walmart. Aligning your strategy with the platform's core audience is not just a suggestion; it's a requirement for success.
Advertising Showdown: Amazon Ads vs. Walmart Connect
In today's crowded marketplaces, a "build it and they will come" approach doesn't work. A smart advertising strategy is crucial for driving traffic and sales. Both Amazon and Walmart offer robust advertising platforms, but they are at very different stages of maturity, which creates distinct opportunities and challenges.
Amazon Advertising is a highly developed, sophisticated, and incredibly competitive ecosystem. With millions of sellers bidding on keywords, the cost-per-click (CPC) for popular terms can be extremely high. While the platform offers a vast array of tools—from Sponsored Products to DSP—the intense competition means achieving a positive return on investment (ROI) requires deep expertise and a significant budget. It’s a pay-to-play environment where the biggest spenders often dominate the top search spots.
Walmart Connect, on the other hand, is a newer and rapidly growing platform. Because the marketplace is less saturated, the advertising auction is also less competitive. This translates directly into:
Lower CPCs: Brands can often acquire customers at a fraction of the cost they would pay on Amazon for the same keywords.
Higher ROI: With lower ad costs and strong conversion rates, many sellers find their return on ad spend (ROAS) is significantly higher on Walmart.
Less Noise: It's easier to make your brand stand out when you aren't bidding against tens of thousands of other advertisers.
As a certified Walmart Connect Partner and an Amazon Verified Ads Partner, we have a clear view into both ecosystems. While Amazon offers unparalleled reach, Walmart provides a more efficient and often more profitable advertising environment for brands looking to maximize their marketing dollars. Managing marketplace advertising and analytics across both platforms allows brands to allocate budget where it will be most effective, driving growth without breaking the bank.
Marketplace Risk: Navigating Compliance and Onboarding
Getting your products listed is just the first step. Staying compliant with marketplace policies is an ongoing challenge that can carry significant risk. Both Amazon and Walmart have stringent rules, but they approach enforcement and onboarding differently, with Walmart adopting an increasingly strict, proactive stance.
Amazon's onboarding process is famously open. Almost anyone can create a seller account in minutes, which is both a strength and a weakness. It allows for rapid market entry but also contributes to the platform's issues with counterfeiters and policy violations. Compliance is often reactive; you might not know you have a problem until your listing is suppressed or your account is suspended.
Walmart takes a much more curated approach. To even be considered, you must have a U.S. business entity, a history of ecommerce success, and products that meet their quality standards. Their vetting process is designed to weed out inexperienced or unreliable sellers from the start. Recently, Walmart has tightened its grip even further, especially in sensitive categories.
Walmart's New Brand Gating Policies
In mid-2025, Walmart rolled out advanced compliance protocols for high-risk categories like Beauty & Personal Care. As one source noted, "Only brand owners, authorized distributors, and select vetted sellers will be able to list certain beauty items on Walmart Marketplace." This move is backed by powerful AI systems designed to enforce brand protection.
What this means for sellers:
Documentation is Mandatory: To get approved, you need to provide brand authorization letters, valid invoices, and relevant FDA filings upfront.
Proactive Enforcement: Walmart's systems are actively scanning for non-compliance. A missing certification or an unauthorized seller can lead to swift removal of the listing.
Higher Barrier to Entry: While this makes it harder to get started on Walmart, it creates a more trustworthy and brand-safe environment for those who are approved.
Effectively managing these requirements is critical. Services focused on compliance and protection have become essential for brands looking to scale safely on either platform, but especially on Walmart, where the upfront scrutiny is far more intense.
So, Which Marketplace Is Right for Your Brand?
After breaking down the key differences, the answer to the "Walmart vs. Amazon" question isn't about which platform is universally "better," but which one aligns with your brand's specific goals, resources, and stage of growth. The decision requires a careful evaluation of your priorities.
Choose Amazon if:
Maximum Reach is Your Goal: You need access to the largest possible customer base and are prepared for the intense competition.
You Have a Large, Diverse Catalog: Amazon’s "everything store" model is well-suited for brands with a wide variety of products.
You Have a Healthy Ad Budget: You are willing and able to invest significantly in PPC to gain visibility in a saturated market.
Your Brand is Already Established: You have strong brand recognition that can help you stand out from the millions of other sellers.
Choose Walmart if:
Profitability is Your Top Priority: You want to benefit from lower fees and higher advertising ROI to maximize your margins.
You Are a Challenger Brand: You want to gain traction quickly in a less crowded environment and build a strong market position.
Your Products are in Core Walmart Categories: You sell groceries, CPG, household essentials, or other value-focused items.
You Are Looking to Diversify: You want to reduce your dependency on Amazon and tap into a new, growing customer base as part of a smart marketplace expansion strategy.
For most brands, the ultimate answer isn't "either/or"—it's "both." A diversified marketplace strategy that leverages the unique strengths of Amazon and Walmart is the most resilient and effective way to scale. By tailoring your approach for each platform, you can maximize your reach, optimize your profitability, and build a stronger, more defensible ecommerce business.
Conclusion
The debate over selling on Walmart vs. Amazon is no longer a simple one. While Amazon remains the undeniable giant of ecommerce, Walmart has carved out a distinct and powerful position as a less saturated, more profitable marketplace for savvy brands. The lower competition, simpler fee structure, and higher advertising ROI on Walmart present a compelling opportunity to grow without getting lost in the noise.
However, success on Walmart requires a unique playbook—one that respects its value-driven customer base and navigates its stringent compliance demands. The smartest strategy for most brands in today's market is diversification. By leveraging both platforms, you can capture the immense reach of Amazon while capitalizing on the efficiency and visibility offered by Walmart.
If you're exploring how to expand your marketplace footprint and optimize your strategy for both channels, our team can help. As an ecommerce accelerator with deep expertise in both ecosystems, we build tailored plans that drive growth and protect your brand.
Sources
Seller Labs: Amazon vs. Walmart Marketplace: Which Is More Profitable for ...
Incrementum Digital: Walmart vs. Amazon: Where to Sell in 2025
Sequence Commerce: Essential Guide: Selling on Amazon vs Walmart 2025
GreyScout: Beyond the Gate: Why Walmart’s New Seller Approval Is Just the Start
Walmart Corporate: Building trust, powering progress: Walmart’s vision for a safer marketplace