The extremely competitive supermarket industry has made it very difficult for retailers to gain an edge. Grocery stores have traditionally attempted to increase sales through a variety of loyalty programs, including price discounts, promotional offers, and point rewards. But now Walmart seeks to elevate itself by providing a customer experience that offers more convenience to online shoppers.
Expanding upon similar online shopping services offered by retailers such as Peapod, Walmart will now allow customers to order groceries online and then pick up their items at a local store of their choice.
Unlike Peapod, Walmart will strive for a higher level of customer engagement by not charging a user fee. Instead, Walmart will only require a minimum purchase order of $30 and provide loading assistance from an in-store associate.
“The service is a convenient option for parents, shoppers with mobility challenges, and those who want to shop on their own schedule,” Walmart spokesman Ravi Jariwala said in a release. “Plus, it offers shoppers a way to save time.”
Many grocery retailers are implementing online ordering and home delivery services as a way to acquire and retain customer loyalty, especially during what is considered to be a very difficult time for the industry. Grocery stores are not only dealing with busy customers that have less available shopping time, but those shoppers are also increasingly faced with more market options.
“The challenge to provide the unique customer experiences and engagement strategies that are of value to customers is a growing challenge for brands,” explained Mark Johnson, CEO and CMO of Loyalty360 – The Loyalty Marketers’ Association. “As verticals cross over and competition increases, the challenge to create a unique relationship with your customers is front and center for today’s brands.”
Flexibility and convenience are also taking precedence as the desired customer experience of more and more shoppers. Walmart knows this and is willing to invest in convenience as a loyalty strategy.
“Understanding the service / value equation, or expectations, of your customers is paramount to creating long-term brand loyalty and, as we know, profitability,” Johnson added. “Customers are willing to pay for convenience and, although there is not an actual charge for this offering, the value in time savings and convenience is significant and should serve as a mechanism to short-term consideration from competing brands and increase the share of wallet for these customers to Walmart.”
Johnson said the challenge today is to get into the consideration set for customers.
“And once you attain such consideration, to make sure that you exceed expectations, therefore not allowing competitive threats to usurp that position,” Johnson added.
Walmart’s new service is currently undergoing a trial period at select stores in Denver, Arizona, and Bentonville, Arkansas, the site of Walmart’s headquarters. Jariwala stated that Walmart does have plans to allow more stores to participate soon, but a launch date has not yet been set.