Amazon, Walmart, and Costco: The Retail Giants Best Positioned to Survive Economic Turbulence

Amazon, Walmart, and Costco: The Retail Giants Best Positioned to Survive Economic Turbulence

E-commerce Membership Models Could Offer Stability Amid Recession Risks, Says Bernstein

As economic uncertainty looms, not all retailers are equally vulnerable. According to Bernstein analysts, e-commerce giants with strong membership-based revenue models—such as Amazon (AMZN), Walmart (WMT), and Costco (COST)—are better equipped to weather economic downturns than their competitors.

Why These Three Retailers Stand Strong

Bernstein’s report highlights the power of "membership lock-in," where companies generate steady revenue through subscription services like Amazon Prime, Walmart+, and Costco’s membership program. These offerings not only secure loyal customers but also shield revenues from economic slowdowns.

Additionally, Amazon, Walmart, and Costco’s focus on value and essential goods makes them more attractive during recessions, as consumers cut back on discretionary spending and prioritize necessities.

Who’s at Risk?

While membership-driven retailers stand firm, others face greater uncertainty. Target (TGT), Wayfair (W), eBay (EBAY), and Etsy (ETSY)—which depend heavily on discretionary spending—could be more vulnerable if consumer spending weakens, Bernstein warned.

Retail Stocks Feeling the Pressure

Investors are already reacting to recession concerns. Since mid-February, shares of Walmart and Target have plunged 18%, while Amazon has fallen 10%, and Costco is down 13%. The broader market is also feeling the squeeze, with the S&P 500 sliding 6% during the same period.

Adding to the concern, consumer confidence has hit a 12-year low, according to Conference Board data released Tuesday. With shoppers growing cautious, retailers best prepared for leaner times could be the ones that come out on top.