Walmart and Amazon are in a neck-and-neck race over online sales and delivery to rural Americans

Adobe Stock photo

America's biggest retail giants, Walmart and Amazon, are going head-to-head in a bid for online sales domination by delivering to rural areas "once deemed too remote or unprofitable," reports Anne d'Innocenzio of the Independent. "These sparsely populated regions, previously overlooked by major retailers, are now recognized as a significant source of untapped sales."

Walmart seems to have the upper hand because of the proximity of its brick-and-mortar stores to rural communities. D'Innocenzio explains, "Nearly half (45%) of its full-service Supercenters are located in towns with populations under 20,000."

Even with Walmart's edge, Amazon is betting speedy and accurate delivery will help it outperform the competition. D'Innocenzio reports, "Amazon last year invested $4 billion to bring same-day or next-day deliveries to 4,000 smaller cities, towns and rural communities."

Analysts at Morgan Stanley estimate the pot of money rural deliveries will generate rings in at $1 trillion in annual sales, d'Innocenzio explains. With that amount of revenue on the table, the race for the rural online consumer has "intensified."

Part of the reason rural and underserved delivery areas are now getting noticed is because of their changing demographics. D'Innocenzio adds, "This surge is partly driven by the increasing number of remote workers relocating to smaller towns and communities on the outskirts of metropolitan areas."

Until recently, delivering to a more remote address generally posed a problem for companies, who in turn relied on the U.S. Postal Service to go "the last mile" to reach the customer.

Now Walmart is using more delivery drones and robotics, paired with a new delivery mapping system to speed package fulfillment. D'Innocenzio reports, "The system replaced traditional service boundaries like ZIP codes, which can leave out small areas at the edges."

Amazon is taking a different approach by "setting up small delivery stations to serve a group of nearby communities based on travel drive time, customer demand, and delivery efficiency," d'Innocenzio adds.