BENTONVILLE, Arkansas — Walmart’s cavernous stores are known for aisles of low-priced groceries, paper towels and apparel.
Now, those big boxes are hubs for its e-commerce business, serving as launch pads for delivery drones, automated warehouses for online grocery orders និង departure locations for direct-to-fridge drop-offs. Eventually, they will help pack and ship goods for individuals and independent companies that sell on Walmart’s website through its third-party marketplace.
“The store is becoming a shoppable fulfillment center,” Tom Ward, chief e-commerce officer for Walmart U.S., said in his first interview since stepping into the role. “And if the store acts like the fulfillment center, we can send those items the shortest distance in the fastest time.”
Walmart is leaning into two key advantages to drive its e-commerce business: its roughly 4,700 stores across the United States and its dominance in the grocery business. Ninety percent of Americans live within 10 miles of a Walmart store. The company is the largest grocer in the U.S. by revenue. Walmart wants to expand its assortment of merchandise, improve the customer experience and increase the density of delivery routes to turn e-commerce into a bigger business.
The Covid-19 pandemic created an opening for Walmart to expand its online business. The retailer’s e-commerce sales surged, helped in large part by the curbside pickup service it launched years before other retailers scrambled to set on up during the pandemic. One dollar out of $4 that Americans spent on click-and-collect orders last year went to Walmart — more than any other retailer, according to an Insider Intelligence estimate.
The global health crisis also fueled Walmart’s sense of urgency to better compete with Amazon, the clear leader in e-commerce. Amazon has 39.5% of online market share in the U.S. compared with Walmart’s 7%, according to estimates by research firm eMarketer. Last year, based on the 12-month period from June 2020 to June 2021, consumers spent more money at Amazon than the big-box retailer for the first time, according to company filings and estimates by the financial research firm FactSet.
But the e-commerce environment has gotten tougher in recent months. Gains have slowed dramatically as more customers return to stores. Even Amazon saw stagnating numbers in the most recent quarter, reporting its slowest sales growth rate in about two decades.
Plus, as Walmart’s fuel and freight costs mount និង inflation hovers at a near four-decade high, customers are buying less of general merchandise, like new clothes, because more of their money is going toward groceries and gas. Food sales have lower margins, making it harder to profit from online sales.
ក្រុមហ៊ុន Walmart shares sank last month, as it missed quarterly earnings expectations and slashed its outlook for profits. It marked the retailer’s worst day on Wall Street since October 1987.
Even with that backdrop, Ward said Walmart benefits from having a reputation for value. “Price is critical for our customers,” he said. “They trust us to bring them the lowest prices. And there’s 60 years of experience of managing that in this business.”
Leaning on stores
Online evolution
The company also had separate teams of buyers for its stores and for its website, which led to conflicting assortment and pricing. The two teams were blended into one shortly before the pandemic.
In addition, some customers got confused or frustrated by the strange ways Walmart fulfilled purchases in the same online order. This spring, a member of Walmart’s e-commerce team experienced that firsthand when ordering dinner ingredients for Taco Tuesday. Taco fixings arrived through home delivery that day, but the taco seasoning came in the mail days later.
Over the past two weeks, Walmart has rolled out a change meant to eliminate that issue, Ward said. When customers fire up the app to shop, they choose if they want items through shipping, pickup or delivery. Depending on that choice, assortment is tailored to what items — such as taco seasoning — are actually on hand.
A package moves along a conveyor belt inside a Wal-Mart Stores Inc. fulfillment center in Bethlehem, Pennsylvania.
Michael Nagle | Bloomberg | រូបភាព Getty
“We don’t want to show any friction. We don’t want to show any plumbing,” Ward said. “We want to solve all the magic behind the scenes and make it seamless so they can buy a filet steak and a bag of apples and a T-shirt and a microwave and they can get it fulfilled anywhere that they want to get it fulfilled.”
Another emerging piece of Walmart’s plans is its drone delivery service, which Walmart will expand to 37 stores across six states by the end of the year. That development will enable it to reach 4 million households, according to the company.
Down on the ground, Walmart wants every delivery driver in its network to have densely packed routes with numerous stops in every neighborhood. That commitment led to the launch of GoLocal កាលពីឆ្នាំមុន, which allows mom-and-pop shops and publicly traded companies, including ទំព័រដើមដេប៉ូ, to use Walmart’s independent drivers to drop off online purchases.
“A driver might pull up to one of our stores and receive a handful of packages for Walmart customers, they might then go and pick up a handful of packages for a different business or company’s customers, then they’ll follow a highly optimized route, which takes advantage of that density and brings the cost down,” Ward said.
Its membership program, Walmart+, is another way the retailer is trying to score more online sales. The $98-per-year service includes free shipping of online purchases and free grocery deliveries to the home for orders of $35 or more. On Thursday, Walmart kicks off Walmart+ Weekend, a new sales event that resembles Amazon’s Prime Day with deals only available for members.
Walmart in your house
A key part of the retailer’s e-commerce strategy counts on a high level of customer trust.
សេវាកម្មគឺ expanding to major cities, including Los Angeles and Chicago, and Walmart says it will be available to 30 million households by year-end.
Delivery employees are screened through background checks and average 6.5 years of experience at Walmart before getting the job, Pegden said. They wear uniforms, drive electric-powered branded vans, access homes through an entry key pad or a smart lock and have a body camera to record the drop-off. The same two or three delivery people typically visit a customers’ home.
Customers pay $19.95 per month or $148 per year for unlimited deliveries. It is separate from the company’s Walmart+ service.
For Walmart, it is a compelling example of how online orders can become a routine part of life, Ward said. Customers hand over the control, so the company can “keep them in stock so that the cereal is always there, the milk’s never out.”
- ស៊ី។ អិន។ ស៊ី។ ភី Katie Schoolov និង អ៊ីរីនខ្មៅ បានចូលរួមក្នុងរបាយការណ៍នេះ។
Source: https://www.cnbc.com/2022/06/02/walmart-bets-its-stores-will-give-it-an-edge-in-amazon-e-commerce-duel.html