- Walmart Plus (Walmart+) is the paid shipping program on which the retail giant has been working since the past 18 months.
- Prior to Walmart+, ShippingPass was launched in 2015 but it didn’t work out well and the company had to shut it down.
Amazon might be giant in every sector it visions to expand, but in the retail sector, Amazon is competing for head to head with another giant – Walmart.
To give a tough play to Amazon, Walmart is rolling out Walmart Plus (Walmart+) program which is more or less like Amazon Prime service.
World’s largest retailer is developing a paid membership program to challenge the internet giant’s offering.
What Are The + Points About Walmart Plus?
Walmart didn’t disclose everything about it’s Walmart Plus program, but here are key highlights. The service will expand on the retailer’s existing grocery-delivery subscription service.
From nurturing Walmart Plus to its global launch, Chief Customer Officer Janey Whiteside will be responsible. Talking about additional perks, Walmart plus could include discounts on prescription drugs and fuel.
Threat or Competition to Amazon Prime?
Developing Walmart Plus membership program is closely linked to Walmart’s concerns that once a user switches to Amazon, possibilities to shift or even try any other service go very low or nearly impossible.
During Sam Walton’s tenure at Walmart, the man was always against a loyalty program like Walmart Plus (or anything like that) because he argued that Walmart needed to treat each and every consumer the same, irrespective of what and how much or how frequently they order.
In 2015, Wal-Mart Stores rolled out ShippingPass delivery subscription pilot and offering 2-day shipping on more than 2 million items without a membership program.
Items included in the free shipping offer include pet products, cleaning supplies, baby necessities like wipes and foods like cereal and peanut butter.
The 2-day shipping offer didn’t include fresh groceries, freight or 3rd party marketplace items. Wal-Mart first began testing for the ShippingPass program in 2015, offering 3-day shipping for $50 a year.
The program was later modified to offer unlimited 2-day shipping to members who joined for $49 per year. But somehow it didn’t go according to as expected and Wal-mart had to shut down the service.
But Walmart Plus seems to be more ambitious than Wal-Mart’s previous efforts and aims to counter Amazon’s Prime Service.
For Walmart Plus to become Amazon’s threat, it needs to add a lot more service. Look at the service offerings, perks, and benefits coming from Amazon Prime, it’s as big as Amazon’s market cap!
Are People Ready for Walmart Plus?
Walmart Plus being a service, it may become a huge success or it may become another nominal move just like Shipping Pass.
But 2005 and 2019 are not the same right? Amazon Prime has helped Amazon compete on price with physical retailers, allowing it to grow from an online bookseller to the largest online merchant offering a plethora of goods under one roof.
Prime members spend about twice as much as other customers, and their willingness to spend is one big reason why Amazon captured some 40% of all sales growth in the US retail in the holiday quarter.
Both the giants (Amazon & Walmart) happen to be the seller of almost all the goods. While it’s nearly impossible to compete on prices because both the giants need to make a profit and maintain relations with suppliers, the two of them are all set to compete with each other from a service point of view.
Amazon has also taken steps to lure low-income shoppers into Prime memberships by offering monthly membership rates rather than forcing members to pay annually.
Janey Whiteside has become a vital player at Walmart since her arrival from American Express in 2018. CEO Doug McMillan asked her to try and upscale shoppers and merge online and brick-and-mortar operations.
Using Walmart’s existing grocery delivery service as the ground for Walmart plus (Walmart+) can be beneficial. Provided the integration is done optimally and wisely.
Thing is, today if someone is a giant in terms of selling products, someone else will pop up with excellent service offerings (along with products) and it will start eating market share of the existing market leader.
This can be vice-versa as well. If a company has excellent service quality, some other company might pop up with attractive product offerings (along with a decent service quality).
Walmart and Amazon’s case is more or less the same. Both the giants have excellent and almost all kinds of (ethical) products to offer. The only thing that is untouched by Walmart is, to provide excellent service quality.
On behalf of Next Big Brand, we wish all the very best to Walmart’s Walmart Plus. Only time will tell will it be a disruptor or another reason for us to cover “Why Amazon is and will be a juggernaut in terms of business and long-term vision.”