With Black Friday weekend in the rear-view mirror, Walmart is tossing in yet another perk to its e-commerce operation in an effort to sign more shoppers up for its membership program as peak season rages on.
Beginning Friday, Walmart is removing the $35 order minimum initially required for Walmart+ members to get free shipping, meaning these shoppers can get free next-day and two-day shipping on items shipped by Walmart such as clothing, toys and appliances, no matter the basket total.
Walmart+, which costs $98 a year or $12.95 a month depending on the program consumers choose, is the retail giant’s attempt at building out a competitor to Amazon Prime, which costs $119 annually or $12.99 monthly. The service was made available in September after numerous Covid-driven delays that stalled the retailer from initially launching the program in March or April as a rebrand of its $98 grocery delivery service.
After coming up with plans to open the program in July, the project then got delayed again as Walmart continued its focus on other internal initiatives to help improve services throughout the crisis, such as expanding its “store-to-door” Express Delivery service to nearly 2,000 total stores.
The addition of free shipping with no minimum to Walmart+ joins a benefit list that already includes unlimited free grocery deliveries (which still need to meet the $35 minimum threshold since they are shipped from stores), fuel discounts and the ability to use Scan and Go in stores, which lets customers shop and check out with their smartphone.
Related Stories
“Customers have been clear—they want this benefit,” said Janey Whiteside, chief customer officer, Walmart, in a statement. “Being able to toss an item into your cart, regardless the total, and check out right away lets them knock little things off their to do list in no time.”
The retailer is also expanding the number of locations where members can use their fuel savings to include Sam’s Club fuel stations across the country. While members initially had access to fuel discounts of up to 5 cents per gallon at more than 2,000 Walmart, Murphy USA and Murphy Express fuel stations, they now have access to Sam’s Club member pricing at more than 500 Sam’s Club fuel locations.
Walmart, which has prioritized a full-scale expansion of delivery options throughout 2020, specifically in the wake of the Covid-19 pandemic, says that 2,800 of its approximately 4,700 U.S. stores offer delivery, reaching 70 percent of the country. In the summer, Walmart partnered with Instacart to begin testing delivery in three major California markets—Los Angeles, San Francisco and San Diego—as well as Tulsa, Okla. Last month, Walmart acquired select assets of JoyRun, a technology startup that operates a peer-to-peer last-mile delivery platform and network of approximately 540 official merchant partners.
Overall, e-commerce has been extremely kind to Walmart throughout the pandemic, with U.S. digital sales soaring by 79 percent in Q3. A June eMarketer study said that Amazon still leads the way in e-commerce sales by a wide margin at 38 percent of all online sales, while Walmart is ranked a distant second at 5.8 percent.
One area Walmart has beaten Amazon in—two years in a row, in fact—is first-time mobile app downloads on Black Friday. Walmart saw 131,000 installs on Nov. 27 versus Amazon’s 106,000, according to Sensor Tower.
The retailer has since prepared for the holiday season by transforming 42 of its current regional distribution centers (RDCs) into popup e-commerce distribution centers (EDCs) to meet an increasing number of online orders. Walmart anticipates that up to 30 percent of its holiday volume will be shipped from the popup EDCs.
Walmart has not yet disclosed how many people have signed up for Walmart+, but CEO Doug McMillon said on a call with analysts last month that Walmart was “excited about the results” thus far.
That hasn’t stopped people from guessing. In a September poll of 20,000 U.S. shoppers, Piplsay Research found that 11 percent of consumers already subscribed to the Walmart+ service within two weeks of its launch, while 27 percent said they were open to using the service soon.
In a mid-November research note, BMO Capital Markets estimated that as many as 19 million households may have signed up for Walmart+. The projection is based on a survey of about 1,000 U.S. shoppers that found 16 percent had already joined.
Of course, this would still be a far cry from Amazon’s Prime members, but the growth in rapid time is notable. Amazon said in late January that it had more than 150 million paid Prime members across the globe before the pandemic-related e-commerce surge. Fast forward to October, and Consumer Intelligence Research Partners estimates that Amazon Prime had approximately 126 million subscribers in the U.S. alone.