As competition in the grocery space heats up, Walmart isn’t ceding any ground to Amazon saying shoppers will be able to pick up online grocery orders at 1,000 more stores in the U.S. starting next year.
Company executives told investors Tuesday that grocery is key to hooking shoppers who may then go on to purchase the cosmetics, clothing and various other products that fill Walmart’s shelves.
“If you could offer fresh produce … with the very best prices, with a really good experience whether it be pick up or delivery, then you have a good chance to build a long standing relationship that you can then leverage to sell the rest of general merchandise,” Marc Lore, president and CEO of Walmart eCommerce U.S., said at the annual investors meeting in Bentonville, Ark. “I think we have an advantage. We have assets to leverage in that area and so we’re going to . . . lean in pretty hard.’’
The big box chain is more than three times bigger than Amazon based on revenue, and is the largest grocery retailer in the U.S. But Amazon, currently the fifth biggest player in the U.S. grocery space, bought Whole Foods for $13.7 billion in August, sparking speculation that it would use the premium supermarket brand’s 468 locations to expand Amazon’s grocery delivery service.
Since then, Walmart has been busy making its grocery offering more convenient. It announced last month that it is testing a service in northern California in which drivers not only deliver groceries and other online orders, but will put the meat, milk and eggs right in the customer’s refrigerator.
Shoppers who buy produce, poultry and other household items at Walmart.com will be able to pick up their orders at 1,100 locations by the end of this year, and that number will nearly double in 2018.
Even as it makes the most of its brick and mortar footprint, Walmart is seeing significant success online, saying Tuesday that it predicts it will see a roughly 40% increase in e-commerce sales in the U.S. next fiscal year.
Walmart shares were up 4.47% to $84.13 at the time the markets closed, but had slipped .12% to $84.03 in after hours trading.