Published July 15, 2020
Walmart Inc.’s (NYSE:WMT) planned Walmart+ service, which reportedly launches later this month with a $98 annual fee for same-day deliveries of groceries and general merchandise as well as fuel discounts, may not rain on Amazon.com Inc.’s (NASDAQ:AMZN) parade. And that may not matter.
The subscription-based initiative, first reported earlier this month by the online publication Recode, would expand a pure e-grocery delivery initiative that Walmart launched late last year. The new service will offer similar benefits to Amazon Prime, Amazon’s wildly successful online offering, though at a lower price. Amazon Prime costs $119 a year for unlimited one- and two-day shipping, and offers same-day deliveries for an additional fee. Prime has 150 million worldwide members, while Amazon offers 10 times more merchandise than Walmart.com. The Amazon Prime package also includes movies, music and other benefits, making it what is known in retail as a “category killer.”
Store networks are an integral part of what Jim Tompkins, founder and chairman of global supply chain consultancy Tompkins International and arguably the most influential industry guru of the past 50 years, called “unichannel fulfillment.” The term describes a unified channel in which neither e-customers nor in-store customers exist, and which focuses on an integrated and seamless customer experience without any channel differentiation, according to Tompkins. A robust store network gives retailers the optionality to fulfill from anywhere, thus delivering the right product, from the right place and at the right price, Tompkins believes.