How Walmart’s Digital Push Is Winning Over Amazon’s Affluent Customers

It started with a case of Topo Chico on the porch, along with Graza olive oil and La Roche-Posay face wash. When a 4-year-old declared her sole diet would be Uncrustables, a box arrived within the hour—cheaper and faster than Amazon, with no delivery fee. The culprit? A newly activated Walmart+ membership.

My husband’s shift to Walmart’s app for daily orders—from groceries to last-minute Passover horseradish—highlighted a broader trend. Fifteen years of Amazon Prime loyalty vanished overnight. We’re not alone.

Walmart’s Quiet Transformation Into a Digital Powerhouse

For decades, Walmart served rural and working-class families as America’s go-to retailer. Today, it’s quietly reinventing itself as a digital behemoth, directly targeting Amazon’s affluent, urban customer base. The numbers tell the story:

• E-commerce sales now account for 18% of Walmart’s total revenue, exceeding $100 billion in the last fiscal year.
• E-commerce growth is accelerating at four times the rate of overall sales, with a 20% increase in the most recent quarter.
• This marks the 11th consecutive quarter of double-digit e-commerce growth.

Five years ago, Walmart launched Walmart+, a direct competitor to Amazon Prime. The membership includes perks like a free Peacock subscription and costs $98 annually—$41 less than Amazon Prime’s $139.

Why Walmart Is Outpacing Amazon in Key Areas

To be clear, Walmart is not poised to overtake Amazon’s $440 billion U.S. e-commerce dominance in 2025. Amazon’s scale remains unmatched. However, Walmart has identified—and is exploiting—Amazon’s critical vulnerabilities:

• Grocery delivery: A seamless blend of digital and physical retail where Amazon has historically struggled.
• Last-mile fulfillment from stores: Leveraging its vast network of locations for faster, cheaper deliveries.
• Price sensitivity: Offering the same premium products at lower costs.

The Surprising Shift: Higher-Income Shoppers Embrace Walmart

Since its 1962 founding, Walmart has catered to budget-conscious families. Yet in recent years, a new demographic has quietly emerged: affluent shoppers with household incomes well above six figures. These customers order prestige items like Madison Reed hair color and premium pet food from The Farmer’s Dog.

Neil Saunders, managing director at GlobalData Retail, attributes this shift to inflation’s post-pandemic surge in 2022.

"Middle- and higher-income consumers migrated to Walmart because they realized they could buy the same products they were getting elsewhere, but a bit cheaper. When this first happened, people thought Walmart would lose these new customers as price levels stabilized, but this hasn’t happened."