Walmart To Go Takes the Hills of San Francisco

My calves were feeling the burn as I walked the hills of San Francisco yesterday while out visiting our West Coast customers.  Being the supply chain geek that I am, the view of the Bay was eclipsed by a sighting of a Walmart home delivery truck.  These new services always seem to be tested on the West Coast leaving those of us in other parts just reading about them.  I can definitely see the value of home delivery here — there is no way I would want to haul my groceries up those hills!

Walmart Expands ‘To Go’ Test As Competition Heats Up for Online Grocery Sales

By Barbara Thau

The battle for shoppers’ online grocery dollars is heating up.

Walmart is expanding its Walmart To Go test so that consumers can now order groceries and general merchandise items online and pick them up at a nearby store for free, in addition to having them delivered to their home for $5 to $7.

The world’s biggest retailer began testing Walmart To Go in 2011 in San Jose and San Francisco, and expanded the program to Denver in October 2013.

Shoppers can order fresh, dry and frozen groceries on Walmart.com as well as thousands of general merchandise items, including electronics and toys.

Supermarkets have been the final retail holdout to take the online plunge. Groceries are a tricky, low-margin, business. Food is perishable and storage logistics can be complicated.

But they’re also a high-frequency, largely recession-proof purchase – hence its appeal to retailers.

Like Walmart, Amazon.com AMZN -1.56%, the world’s largest online retailer, is tiptoeing down the grocery aisle by testing its AmazonFresh program in Seattle, Los Angeles and San Francisco.

Meanwhile, online grocer Peapod seems to have figured the model out: The Illinois-based company is ranked the top provider of online groceries in the U.S., CNET reported.

Peapod shoppers can even order groceries in subway stations around the country by scanning the barcode of an item with their cell phone on a Peapod billboard-like display.

Wal-Mart says 90% of its shoppers that have used Walmart To Go in Denver rated the service “above average” or “outstanding” since launching the test in October.

And the new free pick up option reflects shopper requests, Ravi Jariwala, director, public relations for Walmart.com, told Forbes.

“We’re hearing many customers want the convenience of being able to pickup groceries for free from our stores on their way home from work, after errands, on the way home from sports practice, or when they’re out and about driving past our stores anyway,” he said.

“Customers are looking for new and, more importantly, convenient ways to shop. They’re moving away from being told how to shop and are now telling us how they shop. This next phase of the test is all about letting customers choose the way they want to shop Walmart for groceries.”

As for whether Walmart To Go will roll out to other markets, “We’ll let our customers dictate that,” Jariwala said. “This test allows us to understand what works best for them, and how we can combine digital and physical assets to serve them in a way that no one else can.”