Walmart deal shows it’s serious about same-day delivery
Walmart’s decision earlier this year to offer discounts on more than a million products purchased online and picked up in its stores was an acknowledgement that home delivery is an expensive proposition for retailers. Today’s news that Walmart has acquired Parcel, a same-day delivery service based in Brooklyn, NY, is also an acknowledgement that there are plenty of people who want online orders delivered to their homes — quickly, in many cases — even if it costs more.
The Parcel acquisition is relatively small on the scale of recent deals by Walmart going back to the $3.3 billion it paid to acquire Jet.com last year. Parcel specializes in same-day and last-mile delivery to customers in New York City. The service counts Bonobos, also acquired by Walmart this year, and meal kit companies Chef’d and Martha & Marley Spoon as customers.
Nate Faust, senior vice president, Walmart U.S. eCommerce supply chain, wrote on a company blog that he sees the acquisition driving same-day deliveries for the retailer in the local market. Parcel makes same-day deliveries in scheduled two-hour windows around the clock, seven days a week.
“Jet has been testing free same-day delivery of certain orders to customers in New York City,” wrote Mr. Faust. “We can build upon that and plan to leverage Parcel for last-mile delivery to customers in New York City — including same-day delivery — for both general merchandise as well as fresh and frozen groceries from Walmart and Jet.”
According to Mr. Faust, customers have significantly changed their expectations about home delivery in recent years.
“It’s why we’ve focused on creating more options to meet their needs, such as our free two-day shipping to home, our pickup discount and free online grocery pickup service,” he wrote. “It’s also the reason we’ve been testing a number of different innovations at Walmart and Jet to further enhance how we serve customers even faster, with programs ranging from associate delivery to in-building and in-fridge delivery with Latch and August Home.”
- Who is Parcel? What This Delivery Company Means to Walmart – Walmart
- Walmart has acquired the logistics startup Parcel to help launch same-day delivery in New York City – Recode
- Is ‘free’ a big enough incentive to get consumers to try click and collect? – RetailWire
- Will customers let Walmart deliver in-fridge? – RetailWire
DISCUSSION QUESTIONS: What do you make of Walmart’s acquisition of Parcel? Do you see demand for same-day delivery growing in more densely populated communities around the U.S.?