Walmart.com is charging $1.33 less than competitors for "Harry Potter and the Half-Blood Prince," helping snare sales from Amazon.com and fueling growth at...
Orders on Walmart.com for the sixth book about the young wizard who battles the evil Lord Voldemort jumped fivefold compared with “Harry Potter and the Order of the Phoenix” two years ago, spokeswoman Amy Colella said.
Walmart.com is selling the Harry Potter title for $16.66 compared to $17.99 for Amazon.com, Barnes & Noble and Borders. Amazon.com took 1.4 million pre-orders worldwide as of Tuesday. Walmart.com declined to release its sales figure.
“One of the primary benefits of the Web has always been the ease with which consumers can price shop,” said Graham Mudd, an analyst with ComScore. “Even a small price gap can translate to a significant sales gap.”
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The surge in demand for the 672-page book by J.K. Rowling reflects the growing threat that Walmart.com poses for Amazon.com, the world’s largest Internet retailer. Walmart.com became the third-most-popular online retail site in May, up from fourth place, according to ComScore Networks, a Reston, Va.-based Internet research firm.
“We are taking share from some of our competitors,” said Raul Vazquez, vice president of marketing at Walmart.com. “We have started to understand our customer better,” Vazquez said, offering products such as hot tubs and some LCD-screen televisions not found in stores.
Amazon.com, which is celebrating its 10th anniversary this month, will increase sales worldwide by 22 percent this year, a decline from last year’s 31 percent gain to $6.92 billion.
Wal-Mart, the world’s biggest retailer with $285.2 billion in revenue last year, said its online-sales gains are running at two to three times the industry average.
Retailers including Dallas-based Neiman Marcus Group are also posting online gains bigger than Amazon.com. Neiman Marcus and Minneapolis-based Target each said 2004 Web sales doubled.
Walmart.com boosted sales in the past year after adding apparel, pet products, custom music CDs and flowers to its mix of furniture and electronics, including 60-inch plasma-screen televisions for $7,848.
Walmart.com‘s strategy is to build market share partly by integrating its products with the company’s stores, said Jim Breyer, managing partner of Accel Partners and a Wal-Mart director. This includes allowing customers to order digital photos on line and pick them up in stores.
“The competition is indeed extremely well managed and includes companies such as Amazon, EBay and emerging start-ups,” said Breyer, whose firm was a minority owner of the Web site until Wal-Mart bought out its partners in 2001.
The Web site’s traffic rose by 37 percent to 22.6 million visitors in June, making it the third-most popular retail site behind eBay and Amazon.com. Target’s online store had an 82 percent increase in visitors to 19.8 million during June, according to ComScore.
“Amazon is a full-fledged online retailer, whereas Wal-Mart uses it to drive traffic to the stores as much as get sales online,” said Don Gher, who owns Wal-Mart shares among the $650 million in assets he helps manage at Bellevue-based Coldstream Capital Management.
Amazon.com‘s U.S. traffic growth is slower than that of some traditional retailers. In June, visits totaled 40.1 million, a 22 percent increase from a year earlier.
Amazon.com has added discounted-shipping programs as well as traditional retailers to its site. This year on Amazon.com, Macy’s and Bebe Stores joined retailers including Nordstrom, Target and J.C. Penney.
The number of items sold by other merchants, which pay a sales commission to Amazon.com, rose to 27 percent of units in the first quarter from 23 percent a year earlier.