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[23 comments]

Walmart Asks Shoppers: Will You Drop This Off On Your Way Home?

March 29, 2013

Walmart really is intent on competing with Amazon.com by any legal means necessary and the latest idea the chain is kicking around truly involves thinking outside the big box.

According to reports, Walmart is considering paying customers in its stores to make deliveries to other shoppers. Right now, according to Reuters, the retailer is using FedEx to make deliveries, or its own trucks in the case of its Walmart to Go same-day delivery test.

For making deliveries to others, Walmart would give shoppers a break on their own purchase. The discount would be the rough equivalent of the cost of gas needed to drop off packages.

"This is at the brainstorming stage, but it's possible in a year or two," Jeff McAllister, senior vice president of Walmart U.S. innovations, told Reuters.

Walmart would not be the first company to use crowd sourcing to match people who have spare time with small jobs. Startups including Fiverr, TaskRabbit and Zipments are already operating in the space.

A number of concerns could affect the viability of the service, including the discomfort that some may feel with a stranger pulling up to their door to deliver products to their home. Zipments, which uses crowd sourcing to find people to make deliveries, screens the individuals it hires.

A MoneyWatch piece pointed to a number of negatives associated with having shoppers deliver orders to other customers. These include:

  • Walmart's possible liability for accidents that happen during the delivery process.
  • The chain being held responsible for worker comp claims if customers making deliveries are injured in the process.
  • Customer complaints when deliveries are not made according to the planned schedule.
  • The possibility of drivers engaging in criminal activity.

 

FINANCIALS:     [NYSE:WMT] [ ]

Discussion Questions:

What do you think of chains such as Walmart using crowd sourcing to find shoppers to deliver online orders to other customers?

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 likely do you think it is that Walmart will used crowd sourced drivers in the future to make deliveries to its customers?

Comments:

While this may be a great idea on paper, we have a legal system that will have its day with this program. Say a customer is hurt on their way to deliver items to others. That, and car accidents, trespassing and a number of other issues should kill the idea. Delivery by Walmart employees will work, but only employees covered by some form of liability.

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Frank Riso, Principal, Frank Riso Associates, LLC

Bad out-of-the-box idea. First, why would a customer do it if the discount they will get would be the equal to the cost of gas to make the delivery? Also, as mentioned, all the legal issues that would crop up in terms of liability, bumping into the car parked in the driveway or worse, kids playing. Zipments screens people for this purpose, but come on, we as a nation are not even doing a good job screening people who are lining up to buy assault rifles that are kept out of the hands of our law enforcement, so I think Walmart should take its time on this one.

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Zel Bianco, President, founder and CEO, Interactive Edge

Not going to happen. Far too many downsides with cost being the only upside. Legal issues, shrink, etc., all come into play in this model. I have a hard time believing Walmart or anyone else would even consider this method of delivery.

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Steve Montgomery, President, b2b Solutions, LLC

Walmart's driving principle seems to be "How can we get vendors, employees and (now) customers to make us a wealthy as possible at their own expense?"

From an energetic perspective this has 'run for your life' written all over it.

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Ian Percy, President, The Ian Percy Corporation

There are a number of potential problems with crowd sourcing deliveries. Unless the people making the deliveries are well-vetted the potential for problems would seem to outweigh the cost savings to Walmart. I understand the desire of retailers to shorten delivery times and costs, but it would seem to make more sense to have consumers pay for delivery from trusted companies like UPS and FedEx.

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Max Goldberg, President, Max Goldberg & Associates

For legal/liability reasons, let alone the sheer coordination of a program like this, my guess is that this will never really get out of the starting gate.

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Brian Numainville, Principal, The Retail Feedback Group

This sounds like a really cool idea that embraces the current crowd-based lean start-up thinking. However, it would likely be nightmarish for many involved, particularly Walmart, if it ever got beyond an alpha test.

Liability, lost merchandise, wrong delivery drop-off, etc., etc., etc.

I have to believe that this nothing more than a trial balloon, floated for general reaction.

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Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive

Neat idea, but the execution for Walmart would be a nightmare. All downsides, almost no upside. Not the least of which might be the customer reaction.

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Gene Detroyer, Professor, Independent

Seriously??? I thought for a second this was one of those stories from The Onion. Horrible idea.

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Doug Fleener, President and Managing Partner, Dynamic Experiences Group

This is the strangest latest idea in retail. As a consumer, I sure don't want to trust an unknown individual to deliver my prescription, or the soccer cleats my child needs. The idea must have legs if it's being floated, and it would be truly interesting to find out why they think this might work.

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Cathy Hotka, Principal, Cathy Hotka & Associates

I agree this is a goofy idea, for just about every reason mentioned. But, give credit to Walmart for even thinking of it. It shows they are really doing their brainstorming legwork, which will no doubt lead to other ideas which end up working. And, the idea of recruiting some of their best customers to do part-time jobs can work in other forms.

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Al McClain, CEO, Founder, RetailWire.com

I say, Walmart, don't quit your day job! This one is not even half baked, but maybe you can find a nugget in it.

Lee Kent, Let's meet share and succeed in Retail, YourRetailAuthority

For all of these reasons: Walmart's possible liability for accidents that happen during the delivery process. The chain being held responsible for worker comp claims if customers making deliveries are injured in the process. Customer complaints when deliveries are not made according to the planned schedule. The possibility of drivers engaging in criminal activity.

One thing is evident, it is an idea certainly not easily or likely to happen as we might think it would happen.

Yet, in spite of all of those reasons the story shows one thing that should be abundantly clear to everyone in retail. It shows the level of thinking going on in an organization that is, has been, and will be, intent on world dominance.

So, yes, we can criticize and point out its challenges, but on the other hand, it should be eye opening as well. Sure, it may not work or may not be a solution that ends up being implemented. One thing is for sure, a solution likely will come out of this type of thinking that will challenge just about every type of retailer.

If this type of thinking isn't going on inside retailers intent on being competitive, it should be. Retailers should be looking at this type of thinking and figuring out how they can foster it, cultivate it, and grow it in their own organizations. It is the reason that Walmart remains the dominant player they are and likely will be for any term of the foreseeable future.

'Scanner'

Highly unlikely due to a few reasons. The first being liability in case anything was to happen to the driver. Additionally, Walmart would not be able to control the customer experience that their crowd-sourced delivery man will provide. This would reflect negatively on their brand image if there were problems with the delivery. This is a trend that will expand in the future. However, I believe an intermediary will be the solution.

Matt Lincoln, IT eCommerce Business Analyst, Quill.com

A great idea if you can find shoppers who will follow through and actually deliver the merchandise. Go to "people of Walmart." Now would you want any of these folks walking up to your front door? There is a reason that USPS, UPS and FedEx wear uniforms! If Walmart is looking for store to door delivery, then the very best asset is the USPS followed by UPS. I bet they could work some thing out with with the USPS as they seem to be hurting for money.

Ed Dennis, Sales, Dennis Enterprises

You know, seems kind of nutty, but stranger things have happened in retail. Like door to door sales people way back when. Besides, some under-the-radar things like this ARE working elsewhere, like the crazy 'cab sourcing' in San Francisco, which is making legit cabbies nuts. 'Delivery sourcing' by Amazon is also working there, so who knows?

Maybe it's the new employment bubble? Soon, we'll all be driving around delivering things for retailers. BTW, I'm open to take anything from Dublin Ohio to Upper Arlington tonight if you guys need something delivered. 5 bucks.

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Lee Peterson, EVP Creative Services, WD Partners

When you think of Walmart, it's hard not to think about its massive scale, and I think that explains much of the skepticism surrounding its recent experiments. These days, massive roll-out isn't the end game for every one one of Walmart's tests. The customer-runner model could be deployed in select markets and/or tested for a limited time and then pulled. I give props to Walmart for its agility and willingness to test, iterate and, in some cases, isolate.

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Carol Spieckerman, President, newmarketbuilders

Come on George, admit it: this was really a story you made up to surprise all of us on Monday...wasn't it?

'notcom'

In the 60s as a high school student in Topeka, I started a bidness using casual motorists to carry packages the 60 miles on I-70 between Topeka and Kansas City, MO. This was before FedEx and UPS, and the USPS was slow and expensive for the time. I just parked a van beside the road at each end of the route, staffed by one person. They accepted packages from any shipper, along with a fee, and paid volunteer motorists who were going that way anyway to carry them to the van at the other end of I-70. Shippers were responsible for delivery to the vans, and pick-up could be by the same shipper at the other end, or by the USPS, or even by the eventual recipient.

It was too successful. With school responsibilities I couldn't supervise adequately, and the logistics and organization eventually outgrew my management skills. It was fun for a while, though, and I don't remember losing any shipments to nefarious motorists. It was a very different time.

Today we do have FedEx and UPS, experts at local delivery, so why try to invent an alternate delivery system? Even Lowe's contracts deliveries to companies that have the expertise to do installations and pick-up/takeways. Lowe's doesn't DIY deliveries.

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M. Jericho Banks PhD, President, CEO, Forensic Marketing LLC

Really, do I want a typical Walmart shopper coming over to the house? Neighbors would not appreciate that. We want the neatly groomed UPS and FedEx drivers. Still, I give Walmart credit. They are already using customers to perform free price checks for them by having them send in grocery tapes from competitors. This is just another way Walmart is trying to cut down on labor and expenses.

David Livingston, Principal, DJL Research

The idea is excellent, but the cons outweigh the pros. People management—especially when they have little at stake—becomes difficult. It would be a viable option once Walmart figures out a way to manage risks involved in the same.

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Shilpa Rao, Practice Head - Merchandising, Tata Consultancy Services

Walmart may want to compete with Amazon more directly, but this is not the way to do it. All I can see in the future of this experiment is a series of embarrassing YouTube videos and national news stories about "package scamming" by Walmart volunteer delivery drivers.

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Bill Hanifin, Managing Director, Hanifin Loyalty LLC

I have to believe that the majority of individuals writing these comments do not shop at Walmart and never will. Therefore, they really do not have to worry at about a Walmart customer coming to their door. I also do not see Walmart even remotely moving forward with the idea for all the reasons mentioned.

However, with that said, it will not surprise me if Walmart creates their own delivery company to resolve the current delivery problems. They have the size and financial resources to accomplish this and who knows, it may just revolutionize the home delivery market.

Gene Michaud, Principal, tGrowth Solutions

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