This is the third of our six part series on Walmart’s pivot to digital. This time, we glance at how several Consumer Electronics brands are using three fundamental eCommerce levers to succeed on Walmart’s new digital shelf. Earlier, we examined three key facets of Walmart’s digital initiatives and what implications they have for brands. Later we’ll look at how Beauty and Food brands are adapting to the new eCommerce environment, and finish the series with a summary of a few best practices brands should use to win on Walmart’s online properties. Also included is a Q/A blog post published last week with Planet Retail RNG senior analyst David Gray and Clavis Insight Chief Marketing Officer Danny Silverman, as they tackle several key questions generated by attendees of our recent special edition webinar, “Winning on Walmart Part 2: Driving Traffic, Sales and Share on Walmart’s Online Properties,” which can be found here.
Consumer Electronics is one of the deepest, well established, and competitive categories in eCommerce, and Walmart is far and away the largest consumer electronics retailer in the U.S. On Black Friday weekend 2017, for example, Walmart controlled almost twice as much of the CE market share as its nearest competitor. In tandem with Walmart’s recent digital pivot, Walmart.com has unsurprisingly become one of the most important retail platforms to win for consumer electronics brands. But in order to win here, brands must understand the contours and features of the new landscape. Read below to get our insights on trends for three of the most fundamental eCommerce levers - search, ratings and reviews, and availability for consumer electronics, and how a few brands are already leveraging them for success on Walmart.com.
Samsung is one of the established CE brands performing strongly on Walmart.com. The Korean giant controls 11 out of the 20 first-page entries for the term ‘4K TV,’ for example. Since more than half of shoppers don’t scroll past the first page of results, this first-page dominance means that Samsung has a potential stronghold on the 4K TV category from a sales standpoint. Samsung is also the top performer in computer monitors, with 20% of first-page results, while HP is a close second. HP, however, is the leader in the most coveted of CE categories: laptops. It controls 35% of first-page results, beating out major brands like Dell, Acer, and Lenovo. In addition to generating traffic, visibility, and conversion for their own products, brands that control so much search real estate limit the visibility of their competitors.
Search performance is highly competitive - especially in this category - and brands must scrape and claw for any advantage possible. Two major ways to improve search performance include optimizing product detail page content by including key search terms for their product categories and ensuring you have a deep breadth of product listings to help increase the chances of owning total search results for the category. HP and Samsung, for instance, lead all CE brands in total listings on Walmart.com, giving them another advantage over their competitors. So long as a reasonable number of their products perform strongly, a broad product lineup will make it easier for brands to control a higher percentage of search results.
Although performing well in ratings and reviews affects search performance, ratings and reviews have a bigger impact on conversion. From a numbers standpoint, LG is the clear ratings and reviews winner with more than 10,000 total reviews and an average rating of 4.6 stars. Of the two metrics, though, total number of reviews has the bigger impact on conversion. Samsung, for instance, also has an average rating of 4.6 stars, but less than half the number of reviews. This means that LG has a big edge in conversion rate potential despite the identical ratings. An average rating of four stars improves conversion by a factor of 1.5, with diminishing returns thereafter. That’s the sweet spot - as long as brands can maintain a 4 star rating or higher on their products, total number of reviews becomes the far more important metric to driving conversion.
Finally, product availability is a crucial but sometimes overlooked factor in improving search performance. ‘Low-stock’ is defined as out-of-stock, one item remaining, or available in-store only, and getting saddled with the low-stock tag greatly decreases a product’s search rank and sales. Availability is also a major element in Samsung and HP’s dominance on Walmart.com - both brands have less than 10% of their items listed as low-stock.
And on the other hand, poor performance in product availability can severely hamper a brand’s ability to compete on the digital shelf. Take Viotek and it’s innovative curved monitors, for instance. Four out of Viotek’s seven active SKU’s hold a perfect 5 star rating, but it’s low-stock rate is 57%. All of it’s products still appear in the top 100 search results, but it’s clear that their products’ astonishingly high ratings are the only thing keeping its listings afloat. Major improvement in availability could see Viotek surge up the search rankings and compete toe-to-toe with the CE powerhouses.
Walmart.com has become one of the most important and competitive platforms in eCommerce, especially for consumer electronic brands. To win here, brands must be able to understand and optimize the eCommerce fundamentals, like search, ratings and reviews, and product availability.
To go more in depth on how to succeed in this new environment, give part 1 and part 2 of our Winning on Walmart webinars a listen here, download our latest whitepaper Driving eCommerce Sales on Walmart’s Online Properties, and check out the other blog posts in this series here.