Wal-Mart (WMT) Is The Next Wal-Mart

The New York Times has joined a long line of media and analysts who say that Amazon (AMZN) will menace bricks-and-mortar superstore retailers the way that it did the traditional book shops and DVD distributors.

The Times points out the general merchandise sales at Amazon will top sales of media products like movies and music later this year. Amazon has also launched a line of its own private-label consumer electronics. The range of products that the company offers online is matching it burgeoning growth aspirations.

Amazon will not be able to claim the crown of overall retail king unless it can begin to approach the sales of companies like Best Buy (BBY), Target (TGT), and Wal-Mart (WMT). This is not likely to happen due to the overall sizes of these firms. But, it is not likely to happen online either.

Amazon had just over 66 million unique visitors in the US during July. But, Wal-Mart had 33 million and Target had 28 million. There are probably dozens of retail websites each of which has more than a million unique visitors and most of these are selling a wide array of products along with the media offering that Amazon has. Amazon may be strong in book and music sales, but it is still unusually weak in the sales of general merchandise compared with store outlets at major chains especially when then online operations are included.

Amazon may be one of the most successful internet companies in the US, but it is hardly close to being the most successful retailer.

Douglas A. McIntyre