Amazon Set to Overtake Walmart in Beauty Category — Retail Bum

Morgan Stanley predicts that Amazon is set to extend its supremacy in the beauty industry by becoming the largest player in the space.

According to research led by Simeon Gutman, Amazon is projected to surpass Walmart as the largest beauty retailer in the United States by 2025. The eCommerce giant is expected to capture approximately 14.5% of the market, potentially reaching $180 billion during the time frame. Meanwhile, Walmart will hold around 13% of the market share.

Amazon’s growth in the beauty industry comes along with the company’s overall expansion in the eCommerce space, with estimates projecting a share of approximately 46.5% by 2025.

This shift underpins grocery retailers’ gradual decline in market share in the beauty industry. Even though grocery stores today maintain a sizable 29% share in the U.S. beauty market, their dominance has diminished with the growing influence of specialty retailers, such as Ulta Beauty and Sephora, who have emerged as the primary beneficiaries in this evolving landscape, and a shift toward online shopping.

On Tuesday, June 20, 2023, Amazon experienced a 0.6% increase in its stock value, whereas Walmart had a slight decline of less than 1%. After enduring substantial losses last year due to market downturns affecting tech and growth stocks, Amazon has made a remarkable recovery this year, with its shares rising by 50%.

In contrast, Walmart has maintained a more consistent growth pattern over the past five years, and its stock has shown a 9.3% increase in 2023.

Originally published at https://retailbum.com on June 21, 2023.