Walmart wants to know if consumers want to pick up online grocery orders at an automated kiosk outside its stores.
In a test program, consumers who spend at least $30 worth of groceries from the retailer’s more than 30,000 items—including fresh produce, meat and dairy products—can pick them up for free at a self-service kiosk located in the parking lot of a Walmart in Warr Acres, Okla., a city about 10 miles from Oklahoma City. The plan is for the kiosk to operate 24 hours a day (its hours are currently more limited) so that consumers can pick up their purchases when the store is closed.
When a consumer selects to pick her up her online order at the kiosk, she’s prompted to select a pickup time. The retailer then presents her with a pickup code. At the store an associate, or personal shopper, then gathers the customer’s order. When the customer arrives, she has to type the pickup code into the kiosk. Then a door slides open with her bagged groceries.
A spokesman for Wal-Mart Stores Inc., No. 3 in the Internet Retailer 2017 Top 500, says the retailer trains its personal shoppers to “carefully handpick the freshest produce and choicest cuts of meat, just as if they were shopping for their own families.” The kiosk stores groceries in refrigerators and frozen food in freezers.
The test is Walmart’s latest attempt to leverage its massive store infrastructure to combat Amazon (No. 1 in the Top 500) to boost its online market share. For example, last week Walmart announced it is running a test in which store associates can deliver online orders to consumers’ houses during their off hours to make extra money. And in April the retailer launched Pickup Discount, which offers shoppers reduced prices on “several hundred thousand” items sold only online if they pick them up in a Walmart store.
Online grocery offers Walmart a unique opportunity to grow its e-commerce business given the retailer’s expertise.
Food and household consumables made up 56% of Walmart sales last year—that amounts to roughly $172.38 billion in U.S. grocery sales in 2016—which makes Walmart the leading U.S. grocer and a big player in several other countries. And despite efforts by a number of retailers, including Amazon with its with its AmazonFresh grocery delivery business, the vast majority of grocery purchases occur offline. E-commerce accounted for only 4.3% of consumer retail food and beverage spending last year, according to a recent report by the Food Marketing Institute (FMI) and The Nielsen Co. The report predicts that percentage will grow to 20% by 2025.
Click here to read “Wal-Mart’s e-commerce strategy comes into focus” from the June issue of Internet Retailer. Click here to subscribe to the magazine or sign up here for a Strategy membership to access the story online.Favorite