Walmart’s lax vetting helped fuel a Marketplace boom, but came with fakes and frauds

Marketplace Growth & Strategy - Walmart aimed to compete with Amazon by rapidly expanding its online marketplace [8] - The company relaxed seller vetting policies to attract more sellers, prioritizing growth over strict compliance [7][8][9] - E-commerce revenue has grown approximately 400% since 2019, now representing 17% of US revenue, up from 4% in 2019 [15] - Online growth is crucial for Walmart, given its extensive physical store presence [16] Counterfeit & Safety Concerns - The report identifies at least 43 instances of stolen business identities used to create third-party seller accounts [5] - Counterfeit products, including potentially dangerous items, were sold on Walmart's marketplace [1][10] - A specific example involves a pizza restaurant's credentials being used to sell counterfeit Lancome face cream at a 91% discount [3][4] - Former employees expressed concerns about approving potentially harmful or fake products due to pressure to increase seller numbers [10] Remedial Actions - Following the investigation, Walmart announced restrictions on product listings in the beauty and personal care categories [10] - Walmart will require select sellers to participate in an enhanced vetting program to verify product authenticity [10] - Walmart claims to have a zero-tolerance policy for prohibited or non-compliant products [6] Competitive Comparison - Amazon's onboarding and vetting process for sellers is reportedly more stringent than Walmart's [8][12] - Amazon requires video interviews and more documentation from sellers, unlike Walmart [12][13]