Walmart’s Q3 Results Show Pandemic-Era Shopping Habits Are Likely Here to Stay

Pickup and delivery sales were up ‘triple-digits percentage’

Walmart boxes on conveyor belt
Ecommerce contributed to the bulk of Walmart's Q3 comp sales. Walmart
Headshot of Lisa Lacy

Walmart enjoyed another solid quarter buoyed by ecommerce growth as customer behavior continues to shift from what it was prior to the pandemic to what it will become.

On Tuesday, Walmart said Q3 net sales in the U.S. were up 6.2% year over year to $88.4 billion, while ecommerce sales were up 79% thanks in part to “strong traffic to”

Q3 growth also includes Walmart’s expanding third-party marketplace—which reportedly surpassed 50,000 sellers in July (Amazon had 461,000 active sellers in the U.S. at that point, by way of comparison)—and pickup and delivery sales, which were up a “triple-digits percentage” in the quarter, per an earnings presentation. (Ecommerce sales at its sister brand, membership warehouse Sam’s Club, were up 41% in the quarter.)

The retailer has leaned hard into curbside pickup for online orders this year even prior to the pandemic, starting with its Super Bowl debut in February, which stressed “out-of-this-world convenience.” Following the launch of membership service Walmart+ in September, Walmart is in the midst of a full-on media blitz to evangelize the service and benefits such as same-day delivery. And, according to Walmart’s presentation, it now offers pickup services at approximately 3,600 of 4,800 U.S. locations and same-day delivery from about 2,900 stores.

Per Gartner analyst Zach Weinberg, this marks an increase of 150 stores offering pickup and 170 with same-day delivery in Q3 alone.

“They’re rolling out [the ability to do that] across their entire physical infrastructure,” he added. “As the holiday season starts to ramp up as we get closer to Black Friday into Christmas, I think that will continue.”

But what Weinberg said really jumped out to him was that ecommerce contributed 92% to Walmart’s comparable sales in the quarter, which were up 6.4% overall thanks to grocery, health and wellness, and general merchandise.

“It’s clear that ecommerce is continuing to increase in terms of their revenue growth,” he added.

What’s more, he believes the 92% figure was accelerated by Prime Day in October—and Walmart’s coinciding sales event. Even though they were technically at the beginning of Q4, he said, “I think there was a very high influx [of online shopping] toward the end of this quarter for Walmart, and that drove a large part of the contribution to the comp sales.”

The point of no return

The retailer, like Amazon, continues to see increased demand in the wake of the pandemic, which has spurred more consumers to seek online shopping options—and now it seems there’s no going back. In fact, research from Accenture shows even after the pandemic, ecommerce purchases will increase 169% from “new or low-frequency users.”

That’s very good news for big-box retail. And Amazon.

According to Forrester analyst Brendan Witcher, U.S. consumers are mentally weary from the pandemic and the election and are therefore shifting to retailers “that are more mature in their ecommerce offerings due to perceived reliability.”

Another sign consumer behavior changes are here to stay: Walmart customers continued to consolidate in-store shopping trips with “significantly larger” average basket sizes, the retailer said.

According to Witcher, this is one big advantage of being a large retailer like Walmart.

“In 2019, 84% of U.S. retail was attributed to physical retail,” he said. “As such, [consumers] as a whole are not as digitally savvy … and will gravitate towards retailers where they can build larger baskets due to larger assortments of products.”

Weinberg said the behavior points to sustained shopping habits among consumers in the pandemic.

@lisalacy Lisa Lacy is a senior writer at Adweek, where she focuses on retail and the growing reach of Amazon.