BENTONVILLE, Ark. — As Sam’s Club began allowing customers to buy their groceries online and pick them up in person, the Wal-Mart-owned chain of stores noticed a frequent conundrum: Customers were having to wait too long in the warehouses to get their goods.
The culprit, they determined, was frozen foods. They couldn’t keep these items alongside the dry and packaged goods in an order, so when a customer arrived, workers would have to make their way across the sprawling store to get the frozen items. This presented a wrinkle in achieving the goal of faster shopping trips — the central purpose of store pickups.
On Wednesday, during a presentation at its annual shareholders meeting, Wal-Mart technologists debuted a new tool that solves that problem.
After you’ve placed the order, a notification on your phone prompts you to “check in” when you’re ready to pick it up. Before you hop in your car to retrieve your order at Sam’s Club, you go to that check-in screen and let the store know how long it will take for you to get there. Workers will then assemble those frozen items with the rest of your order so it is ready just in time for your arrival.
“Our focus at this point is to make sure we nail down the customer experience, and soon enough, we’ll start rolling it out to further clubs,” said Eytan Daniyalzade, a leader on Wal-Mart’s mobile innovation team.
This new feature makes clear that Wal-Mart is doubling down on its efforts to get customers to rethink the way they shop for groceries, perhaps the most mundane and essential of retail purchases. While shoppers have already moved in droves to buy clothes, electronics and books online, they have stubbornly clung to the old-school way of filling their pantries and refrigerators. In 2014, researchers with IBIS World estimated that online grocery sales were a paltry 1.9 percent of total grocery sales.
With the presentations Wednesday and Thursday, it was evident that Wal-Mart’s plan of attack for winning your grocery dollars in the digital era will be to blend the in-store and online experience, to make it easy for shoppers to bounce easily from one channel to the other.
On Thursday, the company showed off its Wal-Mart Pickup-Grocery center, one of five pilot facilities built specifically for customers to collect grocery orders that they placed online. The center is not attached to a traditional Wal-Mart store; it is a standalone location where consumers never have to leave their car to pick up their groceries. After typing their name or order number into a kiosk, they pull into a designated parking spot and Wal-Mart workers put their groceries right in the trunk. While the company will not reveal specific expansion plans, it says the offering is getting high customer satisfaction scores.
“It’s a lot of working moms. I get stories all the time about how, ‘Yeah, I order online and my husband comes and picks up,” said Ellen Martinez, operations manager.
Wal-Mart is still learning exactly what kinds of products customers want to order through this set-up. For example, customers using it for the first time tend to be hesitant about purchasing produce and meats they can’t touch and select themselves.
But Kieran Shanahan,vice president of operations for Walmart.com, said that after three uses, customers get comfortable with having these fresh items selected by someone else.
Wal-Mart is still figuring out exactly how to stock these facilities: While a Wal-Mart supercenter typically has more than 100,000 individual items, these smaller pick-up locations have only “several thousand” items, executives said.
In the past month, Wal-Mart said it has also begun testing a version of their pick-up offering that would save shoppers an extra car trip by allowing them to pick up the groceries at their workplace. In this set-up, a truck would be stationed in an office park or other business campus — perhaps for just a few hours a day as workers are headed home, or perhaps all week long if traffic and demand are substantial enough. The trucks would contain orders that shoppers placed online.
Wal-Mart will have plenty of competition as it aims to be your go-to destination for groceries. In addition to traditional supermarkets, Wal-Mart’s chief rival, Target, has said it plans to make a new play for your grocery dollars by revamping its stores to feature more fresh and healthy foods. Meanwhile, online giants Google and Amazon are experimenting with grocery delivery services, as are start-ups, such as Postmates and Instacart.
bc-walmart (TPN)