Walmart continues expansion of grocery pick-up service
BENTONVILLE, Ark. — Walmart has extended its grocery pick up service to eight additional markets and is alluding to the possibility of a more significant roll out in the months ahead.
The nation’s largest food retailer said its free online grocery pickup service was being offered at select stores in new markets including, Atlanta, Nashville, Tucson, Colorado Springs, Charlotte and Fayetteville, NC., and Salt Lake City and Ogden, Utah. Expansion of the convenient service is something customers continually ask for, according to Michael Bender, executive vice president and COO of Walmart Global eCommerce.
“We’ve tested online grocery options – both pickup and delivery – in a handful of markets across the U.S., and each time we’ve added a new city, our customers begin using the service faster than they did in the previous one,” Bender said. “In the coming weeks, we’ll add stores in even more markets to our list of pickup locations.”
Walmart began offering the service several years ago with a test in San Jose, Calif., not far from its Global eCommerce headquarters. It was subsequently expanded to Denver, Phoenix, Huntsville, Ala., and the retailer’s hometown of Bentonville, Ark.
The most recent expansion of the pick up service comes two weeks prior to Walmart’s big annual fall investor conference in mid-October where the company can expect a lot of tough questions about its deteriorating sales performance and rising expenses which have caused shares to tumble to the low $60 range after nosing above $90 back in January. The meeting is typically a venue where Walmart showcases new growth initiatives and an announcement about a more meaningful roll out of the grocery pick up service would be consistent with the company’s long held view that its expansive collection of physical assets and increasingly robust digital capabilities uniquely position it for long term success.
“With 70% of the U.S. population living within five miles of an existing Walmart store, this is an idea that simply makes sense for us,” Bender said of the pick up service. “We have the locations already in place, and with our website and mobile app expertise, we’re able to combine those things in a way that helps our customers save time and still take advantage of our everyday low prices.”
To use the service, customers shop their grocery lists online, choose a time to pick up their orders and then pull in to a designated parking area at their local stores where Walmart employees load the purchases into the car.
“It’s all the convenience of a specially trained personal shopper, plus the things you’d expect from Walmart: the same low prices we offer every day in our local stores, no extra fees or charges and the ability to place an order and pick it up the very same day,” Bender said.
If Walmart is uniquely positioned with its physical and digital assets, Bender is uniquely qualified to make the service work on a national level. He is one of the few executives in Walmart’s Global eCommerce organization with a first-hand understanding of the complexity and operational challenges associated with executing the grocery pick up service.
Prior to being named to his current position as COO of Global eCommerce, a role in which he is tasked with the integration of digital commerce into new and existing formats, Bender spent four years as executive vice president and president of Walmart West business unit of the retailer’s U.S. stores division. Bender joined Walmart in 2009 and gained real world operational experience first as a vice president of operations responsible for Arizona, Nevada and Utah and then as a senior vice president of operations with added responsibility for Colorado, New Mexico, Idaho, Montana, and Wyoming.
Walmart moves closer to renewable future with big wind deal
Walmart has taken a big step towards becoming 100% supplied by renewable energy.
The discounter entered into a long-term power purchase agreement to buy the majority of the electricity generated by Pattern Energy Group’s new Logan's Gap Wind facility.
The 200 megawatt facility is in Comanche County, Texas.
"Walmart has a goal to be supplied by 100 percent renewable energy, and sourcing from wind energy projects – like the Logan's Gap Wind Facility – is a core component in the mix," said Mark Vanderhelm, VP of energy for Walmart. "The energy we'll procure from this facility represents nearly one-fifth of the U.S. portion of our goal to source seven billion kilowatt hours of renewable energy by 2020. That's a significant leap forward on our renewable energy journey."
The facility will sell 75% of the electricity produced to Walmart and a financial institution. Walmart has a 10-year agreement with Pattern to acquire 58% of the expected output from the facility.
Walmart has not set a date for achieving its goal of being supplied by 100% renewable energy. But the chain recently reaffirmed its commitment to renewable energy by joining RE100, a global initiative led by The Climate Group.
This year’s holiday retail trends
The holiday season is rapidly approaching, so of course everyone is thinking about the latest trends in… retail IT. Okay, nobody outside of the industry has visions of technology solutions dancing in their heads, but retailers do need to know what is developing on the IT front as their busiest season arrives.
Fortunately, Verizon Enterprise Solutions has identified five key IT trends that will impact retail during the 2015 holiday season. Michele Dupre, group VP for Verizon Enterprise Solutions’ retail, hospitality & distribution vertical practices, recently shared some insight with Chain Store Age.
Black Friday moves down
During 2014, consumer traffic spiked less on Black Friday and Cyber Monday than in years past, and Dupre sees that trend intensifying this year.
“The season is not tied to any one day,” said Dupre. “It now starts in early November and continues to a couple of days before Christmas.”
In addition to major retailers like Walmart starting their “Black Friday” events at the beginning of November, Dupre said the growth of always-accessible mobile commerce is also lessening the impact of any one specific day on holiday performance.
“There is a larger adoption of mobile engagement, creating different customer traffic peaks,” said Dupre. “Last year, there was a big surge in mobile traffic on Thanksgiving Eve and Thanksgiving that lasted all through the weekend. Mobile traffic slows down during the week and picks up during the weekend.”
In addition, Dupre said the ease of procrastinating holiday purchases provided by mobile phones has pushed traffic peaks later in the season. Last year, there was a major spike in holiday traffic and demand Dec. 20-21, a pattern she expects to be even more prominent this year.
E-commerce – Everyone is doing it
Dupre also identified a continuing shift to e-commerce, including both desktop and mobile customers. Retailers need to follow steps to take advantage of the increased customer intimacy provided by e-commerce.
“Last-minute shopping, more aggressive promotions, and extended shipping deadlines pushed more consumers online in 2014,” said Dupre. “Increased online engagement with customers means loyalty is important. Retailers engaged in an intimate relationship with their customers, based on behavior patterns, can be specific with promotions and have more interaction across channels.”
Who wants home delivery?
The migration of customer traffic online does not necessarily mean in-store traffic will wane. One growing trend that will keep customers coming into stores is the rising popularity of buy-online-pickup-in-store (BOPIS) transactions.
“BOPIS will pick up traction from last year,” said Dupre. “There will be a steady increase this holiday season. An increasing number of retailers have the ability and consumer demand for it will keep growing. It’s necessary for retailers to be convenient in general. In particular, customers now expect BOPIS and same-day delivery.”
The holiday data blend
Big Data is just as, if not more crucial, during the holiday season than it is during the rest of the year. Dupre sees retailers using a new Big Data holiday tactic, however.
“Retailers are performing data blending,” she said. “They take data from multiple sources and fine-tune it to make real-time personalization across channels easier. Real-time engagement drives more conversion. The customer wants gratification in the moment.”
Tis the season for IT knowledge
The final IT trend Dupre identified applies to personnel management. As retail operations on both the back and front ends become more technology-oriented, even seasonal holiday workers will have to come on board with more IT capabilities than they had in the past.
“The makeup of the seasonal employee has changed,” said Dupre. “It’s not just about putting people on shop floor anymore. The entire retail ecosystem supports an omnichannel strategy, whether in the store or in the distribution center.”