American retail giant Walmart Inc. (WMT) surprised all the financial analysts yesterday (May 18th), when they reported earnings. They blew away all estimates and posted impressive sales numbers. With E-commerce sales rising 37% year over year.
Upon release of the surprising reports, Walmart’s stock price rose significantly.
So what if we could have known in advance, and predicted almost perfectly the growth in the retail giant’s E-commerce data? To answer this question we will dive into the company’s Web Traffic data.
Web Traffic
When we surf the Internet, and access websites, our footprint remains both in the internal systems of the site, and in various tools and repositories, that collect this data. Web traffic is the number of visits to a site at a given time. The data can usually be seen in monthly / weekly / daily distribution and historical data can be examined (Some tools require payment, and some offer partial information for free).
Since Walmart’s E-Commerce business is based on visitors entering the company’s site, and purchasing products, we have hypothesized that the amount of web traffic to the site will predict and be somewhat correlated to its sales data from the product in question.
Using the Semrush Web Traffic tool, we examined and compared the amount of visits to the site from search results, both organic and paid. Search engine hits, as opposed to direct hits to the site have the potential to point to new customers, who do not automatically enter the site directly, but first search for the brand. We compared the traffic data to Walmart’s trading site in the first quarter of 2020, compared to the first quarter of 2021 (since Walmart’s fiscal year begins in February, we compared February-April 21 to February-April 20)
In the first quarter of 2020, the web traffic to the site was: February— 216,801,770, March— 218,798,157, April— 216,133,742 for a total of 651,733,669.
In the first quarter of 2021, the web traffic to the site was: February — 292,732,220, March — 284,822,680, April — 277,319,141 for a total of 854,874,041.
This means that compared to the first quarter of 2020, when 651,733,669 people entered the Walmart site from search engines, 854,874,041 entered the site in the first quarter of 2021, an increase of over 31 percent! (31.1).
As stated above, one of the major surprises in the reports released by Walmart is the 37 percent increase in e-commerce sales, a figure very similar to the 31 percent increase in Web Traffic.
Since Web traffic data is constantly updated, it was possible to access this data long before the reports were published, and predict the outcome with great accuracy.
This example shows the power of Tradint, and the ability of researchers to produce new research angles, capable of predicting companies’ performance based on unique data from around the Internet, and not just on the basis of economic data.