How the Average American Will Benefit From Amazon and Walmart Attacking Each Other
There’s a battle brewing between Amazon and Walmart. The two largest retailers are continually vying for permanent space in both the retail sector and America’s heart. But the world of retail is in dire need of a rescue as personal shopping habits shift to online marketplaces and home-delivery services.
One store relies on convenience, while the other depends on price. But what happens when both stores push to combine the two? An all-out blood bath — one in which the prize is your devout customer loyalty.
The internet has been buzzing with recent announcements from both Amazon and Walmart, as each debuts new services that are perceived shots at its opponent. The good news? Consumers are the ones who stand to benefit most from the feud, regardless of which company emerges a winner. Let’s take a look at all the changes coming to the stores (or porches) near you.
1. Personal home delivery from Walmart associates
Walmart employees will now personally deliver packages to your home. The initiative to save customers time and money allows associates to personally deliver packages already set for in-home delivery directly to your door. How? Employees can opt into the delivery service program that’ll have them deliver packages to areas already located on their normal route home. It just makes sense.
Employees earn extra cash, Walmart saves on logistical expenses, and customers get their packages sooner — often next day, according to a company announcement.
Next: How Amazon is playing the shipping game
2. Amazon Prime’s free 2-day shipping with membership
Amazon Prime members gain access to free two-day shipping at a cost of $99 per year or a $10.99 monthly membership fee. But without that membership, you’re stuck paying pesky shipping fees.
For non-Prime members, Amazon recently lowered its free shipping limits from $49 to $25 in response to Walmart’s free two-day delivery policy on qualifying orders of $35 or more. Who will win the free-shipping battle? Who cares? No matter how it shakes out, the customer reaps the biggest reward.
Next: Walmart responds
3. Walmart employs its version of free 2-day delivery
As competition heats up in the marketplace, prices continue to drop. Walmart recently started offering a free two-day delivery service for orders $35 and over to all customers — a direct shot at Amazon Prime’s free two-day shipping program offered through its membership. In addition, Walmart started offering web pick-up discounts on pricey items for customers who pick up their orders in the store rather than have it delivered to their homes.
Next: Amazon targets a new demographic.
4. Amazon debuts a membership rate assistance program
Amazon has a loyal demographic of affluent and middle-class customers. But in an effort to lure lower income customers to its website, Amazon announced a discount on its Prime membership rate for those who receive government assistance. A valid EBT, SNAP, WIC, or TANF card qualifies holders for a $5.99 monthly Prime membership rate with access to all the same benefits, such as free shipping, unlimited streaming of movies and TV shows, and free e-books and magazines.
Next: The fight for grocery dominance begins.
5. Walmart will deliver groceries through Uber and Lyft
Walmart has always been a key player in the grocery sector, offering us some of the cheapest items around. In an effort to compete with Amazon’s online shopping dominance, Walmart is testing a grocery delivery service in which shoppers can place their orders online and have them delivered directly to their doors through Uber and Lyft. Walmart associates compile the items and then charter an Uber or a Lyft to transport the groceries to your location. Testing has begun with Uber in Phoenix and Lyft in Denver.
Those who buy groceries through the program pay a $7 to $10 delivery charge to Walmart, but that’s a small price for a completely hands-off service. Just consider it a win-win. You check off an inexpensive grocery errand from your to-do list without wasting any gas in the process.
Next: Delivery in the form of instant gratification
6. Amazon’s nearly instant delivery services
Things, such as Amazon Prime Now and next-day delivery service, are what gave Walmart the ammunition to construct a new tactical plan that could compete with the e-commerce giant. Amazon Prime members can order anything from electronics to snacks and receive next-day delivery. Then, to maintain its supreme status, Amazon went one step further with Amazon Prime Now, allowing customers to order grocery items online and receive them in under two-hour’s time.
Next: How Walmart is reinventing pickup standards
7. Walmart’s online grocery pickup
Only in recent years has Walmart begun online grocery ordering. But by implementing online grocery pickup — now available at more than 750 stores across the U.S. — Walmart looks to maintain its grocery dominance over Amazon. Although it has a ways to go to master the art of speedy delivery, customers still gain access to some of the cheapest groceries around without the hassle of dealing with the notoriously quirky store crowds.
Next: Amazon’s similar solution
8. AmazonFresh offers supreme efficiency
Amazon is trying to crack into the grocery market Walmart dominates. Its solution? Adding a grocery pickup service with all the modern e-commerce conveniences customers have come to know and love. AmazonFresh customers can order groceries online and then choose a pickup time two hours later. (AmazonFresh members can place an order just 15 minutes in advance.)
And it’s a direct shot at Walmart’s “Every Day Low Prices” guarantee on groceries. It can’t necessarily compete pricewise, but it can surely bank on efficiency. Think of it as a restaurant “curbside to-go” but with produce, lunch meet, and milk. This service is only available at a physical store in Seattle now, but Amazon hopes to open at least 2,000 stores nationwide.
Next: How does Walmart respond?
9. Walmart introduces giant grocery vending machine in parking lots
Walmart isn’t done revamping its grocery sector. It has something better than just personalized delivery. If the thought of navigating the interior aisles of Walmart is positively revolting, know relief is on the horizon. It comes in the form of a fully automated self-serving kiosk stationed in the Walmart parking lot. Here, customers can order groceries online and, after entering a special five-digit code, pick them up at the kiosk, without ever entering the store.
The service is only available in its Warr Acres, Oklahoma, store. Although there is no extra cost to using the service, customers must purchase at least $30 worth of groceries to use the new option.
Next: How both stores are expanding their reach
10. Amazon Cash helps expansion
According to the Federal Deposit Insurance Corporation, 7% of American households were unbanked in 2015 while almost 20% of households were underbanked, meaning they use services outside the banking system for financial transactions. Amazon is hoping to attract these customers by introducing Amazon Cash.
Previously, trying to add money to your Amazon account was a major inconvenience. Long gone are days of purchasing gift cards as temporary cash. Now, customers can simply go to a participating retailer, such as CVS, and allow it to scan a bar code that’ll automatically add between $15 and $500 to your account. If any off-the-grid bankers want to experience Amazon, now’s your chance.
Next: Walmart’s secret weapon
11. Walmart acquired Amazon competitor, Jet.com
Walmart plans to use the Jet.com brand to further its e-commerce efforts and expand on seamless shopping experiences for customers. Jet is one of the fastest growing e-commerce companies in the nation. Since the acquisition in 2016, Walmart has already announced innovative debuts, such as the aforementioned grocery vending and associate delivery. Thanks to the collaboration, consumers are likely to see more changes to their shopping experiences.
Next: How Amazon plans to strike back
12. Amazon’s recent acquisitions
It’s hard to keep up with who’s acquiring whom these days, but perhaps most notable was Amazon’s $13.7 billion acquisition of Whole Foods. This is a direct strike at Walmart’s fresh grocery strength, and many are expecting Amazon’s dip into the sector to lower prices and expand its reach.
In addition, the rumor mill is circulating with hearsay about Amazon wanting to buy Slack, a workplace collaboration platform, to help support its cloud-computing system. We’ll have to wait and see how this affects consumer spending habits.
Next: Walmart continues to dominate in one consumer sector.
13. Walmart caters to SNAP participants
It seems Walmart has earned the trust of lower income shoppers faster than other big-name retailers, such as Amazon. Walmart is the biggest beneficiary of the Supplemental Nutrition Assistance Program. It generated about $13 billion in sales in 2016 from shoppers using the program. And though such a loyal fan base has awarded Walmart in many ways, it could be missing out on an entirely new demographic.
Next: Amazon dominates another sector.
14. The Amazon elite
The most marketable benefits offered through Amazon are available to Prime members only. And though they typically cater to an upper-class society, they’re still fighting to win the hearts of the rest of America — one in which Walmart has enjoyed solid dibs on thus far.
In fact, 82% of households making over $122,000 annually hold Prime memberships, with the rate creeping lower and lower as income falls. Clearly, both companies could stand to profit financially by marketing to a different sector.
Next: There’s still one big benefit to Walmart that Amazon hasn’t accounted for yet.
15. Walmart’s store locations still prove valuable
Still, there’s a battle within a battle. Although both Amazon and Walmart push online shopping experiences, there are still some consumers who prefer to shop the old-fashioned way in an actual store.
A consumer survey by Retail Dive found shoppers ages 35 to 44 are least likely to shop in stores. But younger (ages 18 to 24) and older (age 65 and older) shoppers prefer in-store shopping. Therefore, Walmart has strength in numbers and could outshine Amazon in one key metric: brick-and-mortar store locations. With over 4,700 stores across the U.S., it’s within 10 miles of 90% of the U.S. population.
Follow Lauren on Twitter @la_hamer.