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Walmart Customers to Use Cash to Buy Online

April 27, 2012

No plastic, no problem. That's the message from Walmart, which has announced a new initiative that allows consumers to go online to place orders and then pay for them with cash in its 3,800 stores across the U.S.

The "Pay with Cash" program is the first of its kind from a major retailer, according to Walmart, and gives consumers without access to a debit or credit card the ability to make purchases from an inventory that goes well beyond what is found in the chain's stores. Shoppers go to one of the chain's stores to pay within 48 hours of placing an order. The items are then shipped to them at their home or local store.

Walmart, which has built its business by offering products and services catering to unbanked consumers, believes the new program will enable it to solidify its position in the marketplace. A press release to announce the program cited a study conducted by Javelin Strategy and Research, which found that 81 percent of unbanked consumers have access to the internet.

"Many of our customers shop paycheck to paycheck and are looking for more ways to purchase items online but don't have the means to a credit, debit or prepaid card," said Joel Anderson, president and CEO of Walmart.com, in a statement. "[Pay with Cash] makes it easier for our customers to shop the way they want, where they have access to a broader product selection at Walmart.com coupled with the convenience of payment and shipping as they want."

Walmart said cash is the preferred method of payment for the vast majority of its shoppers.

"The fact that only 15 percent of our transactions are done in the form of credit at our stores means there's a large percentage of Walmart customers who are dependent on cash to transact online. We definitely think it is a big opportunity," Mr. Anderson told All Things Digital.


Discussion Questions:

Discussion Questions: Does the cash payment market represent a big opportunity for retailers selling online? What is your reaction to Walmart's "Pay with Cash" program?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How big an opportunity do services allowing online consumers to pay with cash represent for retailers?


I don't think this is a big opportunity or it would have been done a long time ago. It's kind of like lay-a-way; there is always going to be some need for it. As long as it doesn't take a big effort to implement, why not? It's just another form of C.O.D. There are still a lot of people who live off the grid and Walmart is reaching out to them.

David Livingston, Principal, DJL Research

A great move by Walmart. Let the naysayers prattle on about how Walmart customers aren't online (don't understand streaming media, etc.), in the meantime, Walmart will take it to the bank with the un-banked. This move also takes puts Walmart one big step closer to realizing its global omni-channel aspirations. Hello, emerging markets!

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Carol Spieckerman, President, Spieckerman Retail

We are in the expanded age of experimenting on how to increase sales in an ever-changing marketplace. There are many types of customers and the "Pay with Cash" program will appeal to some of them. Walmart can't afford not to reach every possible customer to keep their momentum going.

Gene Hoffman, President/CEO, Corporate Strategies International

Wow! This is a significant development for Walmart and for shoppers, especially those of modest means.

This is far more convenient than lay-away and doesn't require the retailer to staff or warehouse inventory. There is no chance that Walmart will ship unwanted goods to the store since the product won't ship until the customer actually activates the order by paying for it in cash at a Walmart register.

I believe Walmart can gain a real advantage with this innovative payment option.

Charles P. Walsh, President, OmniQuest Resources, Inc

I like it. I can't pretend to understand the logic of being able to have an internet connection that you pay for with a check or credit card (or however) and still needing to use cash to buy groceries and sundries, but I'm sure it's a plus for Walmart.

Worst case, the customer knows she can "have it her way" and Walmart gets pluses for accommodating its customers. The actual dollar value is sort of irrelevant. It's the policy itself that matters.

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Paula Rosenblum, Managing Partner, RSR Research

What I love about this is that it is so counter to the consensus about a cashless society. It is bold and I think Walmart is right to try. We should all watch this experiment in action.

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Joel Rubinson, President, Rubinson Partners, Inc.

Walmart is smart to pay attention to the unbanked community. The Federal Reserve estimates that 21 million households are unbanked ... so why not attempt to cater to this audience, an important constituency for Walmart?

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Cathy Hotka, Principal, Cathy Hotka & Associates

"Many of our customers shop paycheck to paycheck."

"...gives consumers without access to a debit or credit card the ability to make purchases from an inventory."

This is a dead giveaway; Walmart is creating this service as part of their small-format shops in inner city locations where layaway is still commonplace.

This may be a surprising success as it taps into an untapped e-commerce market of the unbanked.

Ed Dunn, Founder, (Stealth Operation)

This feels like a fairly big opportunity for mass-market and down-market retailers. Kudos to Walmart for understanding their customer and designing a business process that fits the customers' needs instead of the other way around. They are also smart not to ship until cash changes hands at the store; otherwise they could incur high logistics costs from "no-show" orders.

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Martin Mehalchin, Partner, Lenati, LLC

With almost 10,000,000 unbanked households in the US, this is a potential great market.

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Mel Kleiman, President, Humetrics

This idea is not new at all. As usual, Sears has been doing this for quite some time. In their stores you can order online, pay in the store (with cash or any other method of payment) and get free shipping on mailable items from their kiosks.

I also did this just last week at Macy's.

This works very well for customers who are afraid to give out their credit card info online and those who still use checks and cash.


Very insightful move by Walmart, showing they have segmented, analysed, and know their customers; and further are willing to invest to meet their needs. There is a substantial portion of the US population that does not actively use credit cards and in fact may not actually use a bank at all, but may have internet access through various means. Walmart is recognizing that segment and providing incremental value to keep ahead of the competition.

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Verlin Youd, Managing Principal, Verizon

Paula pretty much said it for me -- want a smartphone? No job, no credit, no bank...no problem! But if everyone involved is happy with it, so be it. Of course it's not "really" online selling if it involves not only going to the store to pick it up, but to pay for it as well ... at least not in the Notcom Abridged Dictionary, anyway.


Terrific idea. Not just because it lets Walmart sell its goods to 10 million US households, but because it provides a mechanism by which Walmart can become the agent for those households to buy on the web from everyone else.

Just as Amazon uses its system to make money from orders laid off onto other etailers, Walmart's network of stores can become the instrument to help the unbanked buy from other businesses.

Michael Flanagan, CEO, Clothesource

This will be more important as Walmart goes forward, in more urban areas, and reaching out to more lower-income shoppers. The program makes sense; there are shoppers who will find this a better way to manage limited income.

Anne Bieler, Sr. Associate, Packaging and Technology Integrated Solutions

This is a great concept that extends Walmart's reach to the core of its customers. Simple, smart and easy to implement, this will boost potential sales of these type of customers. The real question remains, how many of these "paycheck to paycheck" customers have full online access and desire to purchase things online?

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Kai Clarke, CEO, American Retail Consultants

Just a different perspective on this. This certainly expands the boundary of "multichannel" retailing. Paying at the store and then potentially ship to store increases the chances of impulse sales.

Domenick Celentano, Founder , FoodBevXpert

This is a new technique when you consider the role that mobile retailing is playing. Why? Mobile broadens the market that Walmart can reach. Even younger adults/kids can shop with their own cash online/on-mobile.

With the new shape that retail is taking even the most basic ideas -- like this -- become stronger and have more potential.

Oh, also, I needed this back when my kids wanted to buy online and "pay me back."

...cash is king!

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Tom Redd, Global Vice President, Strategic Communications, SAP Global Retail Business Unit

I wonder how this is better than COD (Cash on Delivery); Customer engages at 3 touch points -- online, store to make payment, and then home delivery.. Isn't this cumbersome?

Sujatha Shanmugam, Principal Consultant, IBM

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