Published: Thu, March 15, 2018
Markets | By Noel Gibbs

Walmart just made grocery delivery cheaper

Walmart just made grocery delivery cheaper

After testing out grocery delivery over the past two years in six United States markets, the largest retailer in the world said Wednesday it will bring the service to more than 100 metro areas in the USA over the coming months. Each order carries a $9.95 service fee and a $30 minimum, and can be delivered same-day. A Walmart source says that their theoretical plan is to eventually expand this on-demand delivery program to ten or so other cities where Walmart "hasn't built a store presence", assuming there are even ten cities that would qualify for that.

Walmart plans to use its team of personal shoppers to pull together orders in stores and will team up with crowdsourced delivery services including Uber to send groceries.

Walmart's marked focus on "freshest produce" is likely another signal that its countering Amazon's big grocery push - bolstered by the e-giant's $13.7 billion Whole Foods buy past year.

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Walmart Inc (NYSE:WMT) will be bringing grocery delivery to 100 cities by the end of the year. But another review wasn't happy: "What's the point of using this service if I just have to go back to a grocery store to fix your mistakes?", they wrote.

Walmart has invested heavily in its online offerings in hopes of keeping pace with changing consumer tastes, but stumbled in last year's fourth quarter when it experienced a 23 percent slowdown in online sales-growth - less than half the growth rate in each of the three previous quarters. If it's not available yet, don't worry-it's coming to more than 800 stores over the next few months.

Walmart is also covering the delivery cost of customers for the first order that they make. Walmart shoppers living in more than 100 metro areas will be able to get their groceries delivered to their door.

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"We're going to gain customers who might not have access to a brick-and-mortar store", he said. The retailer also recently took on meal kit delivery services, such as Blue Apron and HelloFresh.

Coupled together, this is where the retailer can shine, Sigman says, because online grocery still remains "largely an untapped market".

Facing intense digital competition from Amazon, Walmart has moved aggressively over the past two years to ramp up its e-commerce efforts and leverage its fleet of physical stores - offering new services such as buy online, pick up in store (BOPIS), an improved product assortment and more enticing in-store experiences.

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A big battle is brewing over the delivery of milk, fruit and cheese, and how Americans will spend their hard-earned dollars on groceries.

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