Amazon Vs. Walmart: The War Rages On

AMAZON

Amazon CEO Jeff Bezos has disclosed that its Prime membership program now exceeds 150 million paid members worldwide and that more people joined Prime in its most recent quarter than ever before.

Prime members receive unlimited free two-day shipping on over 100 million different items, but in April the company announced it was in the process of overhauling its U.S. Amazon Prime delivery service to offer free one-day shipping instead two-day delivery for its members. It first said the move would cost the company approximately $800 million and Amazon will be building “most of this capacity through the year in 2019.” Then, in October, it said Amazon CFO Brian Olsavsky said that it is planning to spend around $1.5 billion more on costs associated with one-day shipping during the fourth quarter.

Additionally, last year Amazon partnered with Synchrony Financial to launch the “Amazon Credit Builder” for customers who have bad credit or don’t have enough to get another credit card. The option gives Prime members the same benefits found on the Amazon Store card, such as 5% back for purchases on Amazon.com and no annual fee — although customers will still have to pay Amazon’s yearly membership fee of $119.

WALMART

While Walmart doesn’t have a loyalty rewards program in the traditional sense, it does offer free, one-day shipping without a membership. The announcement last May seemed to be a clear response to Amazon’s Prime membership. Walmart said it would offer free NextDay delivery on a wide range of general merchandise to 75% of the U.S. population by the end of the 2019, including 40 of the top 50 major U.S. metro areas. As The Motley Fool notes: “Walmart's shipping offer is not the same as Prime. It only covers a few million items, and customers have to place a qualifying order of over $35. The chain also only offers mostly two-day shipping with a smaller selection of items available next day in some markets, while Amazon has moved many of its orders to one-day. Still, free beats $119 per year, at least for many consumers.”

Additionally, Capital One and Walmart officially launched a digital-first suite of credit cards last September that deliver rewards to customers who shop both inside and outside of Walmart.  The Capital One Walmart Rewards Mastercard and the Walmart Rewards Card offer Cardholders the ability to earn 5% back on purchases at Walmart.com and on in-store purchases when using Walmart Pay for the first 12 months.

Walmart 

This hybrid of online and physical shopping is growing in popularity with consumers, providing one area where Walmart largely outnumbers Amazon: stores. Last year, Walmart said it would add 900 new pickup towers to the kiosks that were already in place in over 700 locations. To use the service, a customer places an order online and selects for an in-store pickup. The associate loads the ordered item into the Pickup Tower. When a customer receives a notification via email that the item is available, they can use the Pickup Tower like a giant vending machine to retrieve their purchase.

If shoppers don’t want to leave their cars to enter the store, Walmart’s Grocery Pickup service, available in nearly 3,000 stores, allows customers to order their groceries online and pick them up curbside. It also tested its first 40,000-square-foot Walmart Pickup Point in Lincolnwood, IL, where it fulfills online orders through pickup or delivery options, but shoppers cannot shop inside the building.  

Amazon

Amazon has started doing its own buy-online-pickup-in-store service via its Counter launch, which allows Amazon customers to pick up an Amazon package over the counter in retail partner stores. It first launched the service with Rite Aid, planning to expand it to 1,500 stores by the end of 2019. After the Rite Aid rollout, the company expanded the Amazon Hub Counter service to GNC, Health Mart and Stage Stores. Delivery to a Counter location works with same-day, one-day, two-day and standard shipping. As soon as their package arrives at the store, customers receive an e-mail notification with a unique barcode. At the store, staff scan the barcode and retrieve the package.
The service builds on Amazon Hub Lockers, its self-service kiosks that allow customers to pick up packages at a time convenient to them. Lockers are now placed in more than 900 cities and towns across the U.S., inside convenience stores, grocery stores, apartment buildings, and malls. Return can also be dropped off at Lockers.

Amazon

In addition to its acquisition of Whole Foods Market and expansion of Amazon Go convenience stores, Amazon is planning to open the first of many stores in its anticipated new grocery chain in February. The Woodland Hills, CA, store will usher in a new brick-and-mortar channel for the retailer, while yet another mystery store has been reported: In Washington, D.C., permit documents for a site plan indicate that a new Amazon store will sell produce, alcohol, and prepared meals, reports the Washington Business Journal, and includes a "speed lane" for people to enter the store with a swipe.
While shoppers and retailers alike wait to see how Amazon’s physical grocery store plans pan out, Amazon Fresh, which previously cost shoppers $15 per month, is now included in Amazon Prime membership. Prime Members now have free two-hour grocery delivery from Amazon Fresh and Whole Foods Market in more than 2,000 U.S. cities and towns, providing they meet the order threshold. Amazon said grocery delivery orders from Amazon Fresh and Whole Foods Market more than doubled in its recent fourth quarter year-over-year.

Walmart

Walmart went live with Delivery Unlimited at more than 1,400 locations last November. The program gives its customers the option to pay a yearly $98 fee or a monthly $12.95 fee to receive unlimited Walmart Grocery Delivery orders to their doors. “Grocery Delivery takes convenience to a new level, and our customers love it,” Janey Whiteside, Walmart’s chief customer officer said when the program launched on a smaller scale in September. Customers visit the site online or through the Walmart Grocery mobile app and start adding items to their cart. During checkout, they select a one-hour window for their order to be delivered. Trained personal shoppers select the items and customers can track their delivery all the way to the door.
And if the doorstep isn’t far enough, Walmart’s new InHome Delivery service, in which associates deposit online grocery orders directly into refrigerators, is now available to over one million customers. When the order is delivered, the driver uses smart entry technology to access the customer’s home or garage and deposit the groceries directly into refrigerators, thanks to a partnership with smart lock manufacturer August Home. Once the lock ($49.96) is installed, shoppers can get unlimited deliveries for $19.95 per month with any $30 minimum order. The retailer will soon allow shoppers to return walmart.com items through the service, just by leaving them on kitchen counters–no labels, boxes or return fees.
As Walmart works ferociously to further its foothold in the online grocery arena, it’s also testing an autonomous home delivery pilot in Houston with Nuro and its automated grocery-picking robots have moved beyond pilot stage to working alongside associates in a warehouse behind the Walmart’s Salem, NH, supercenter.

Walmart

Last year Walmart created voice ordering capabilities for its grocery pickup and delivery customers that can be accessed across different platforms and devices powered by Google Assistant. Shoppers can say “Hey Google, talk to Walmart” and the Google Assistant will add items directly to their Walmart Grocery cart. More specifically, if the shopper asks to add milk to their cart, the Google Assistant will add the shoppers’ preferred type of milk into the cart. Google Assistant also makes personalized item recommendations based on shopping history and preferences. The Assistant is now available on more than a billion devices, including the Google Home Hub, Android phones, iPhones, watches and more, and it’s cross-platform. Walmart has also partnered with Apple to make Walmart Voice Order available on Siri, expanding the service’s reach. Customers simply ask Siri to start adding items directly to their Walmart Online Grocery cart after they’ve paired their accounts and thanks to AI-based learning, the more shoppers interact with and use the application the more powerful and intuitive it becomes. If the shopper for example always buys Bounty paper towels, after a few orders they could simply say “buy paper towels” and the solution would instantly order the shopper’s preference brand.

AMAZON

Amazon is already penetrating households with devices such as the Echo, which allow users to communicate with its Alexa voice assistant and perform tasks such as voice commerce. Amazon Prime members can ask Alexa to order millions of Prime-eligible items, find items shoppers have purchased before for reorders, and get recommendations. Offline, coming up this year, consumers with Alexa-enabled vehicles, Echo Auto, and other Alexa-enabled mobility devices will also be able to use their voice to pay for fuel from gas pumps at Exxon and Mobil stations. When they say, “Alexa, pay for gas” when they pull up to the pump, Alexa will confirm the station location and the pump number. Digital commerce technology will activate the pump and facilitate token generation to help ensure a secure payment experience. Payments will be processed through Amazon Pay.