Photo: Walmart
Walmart says it’s ready to deliver groceries inside 30 million American homes
Walmart is serious about gaining entry into your home. The retailer announced plans to expand its InHome Delivery service five-fold before 2022 is over.
The retailer, which currently serves a potential market of six million households, launched the service in 2019 in the Kansas City, Pittsburgh and Vero Beach markets. It expanded the program to its home state of Arkansas last year and also added parts of Florida and the Atlanta area. InHome will be scaled to cover a market of 30 million households under the current plan.
Walmart said it would hire more than 3,000 delivery drivers and build a fleet of 100 percent all-electric delivery vans to support the effort.
Customers enrolled in Walmart’s program place orders through the retailer’s mobile app and select InHome as the delivery option. Delivery associates use smart entry technology to enter the garages or homes of customers. Their actions are tracked by way of wearable cameras. While Walmart typically uses third-party couriers to deliver groceries, only specially trained employees work in the InHome program.
“We’ve been operating InHome in select markets over the last two years and have found it is a perfect solution for customers who want to live their lives without worrying about making it to the store or being home to accept a delivery,” Tom Ward, senior vice president, last mile at Walmart U.S., said in a news release. “Identifying ways to help our customers save time and money is our purpose, and nothing showcases that better than InHome delivery, which is why we’re excited to bring the convenience of InHome to even more customers in 2022.”
The InHome Delivery service membership costs customers $19.95 a month or $148 per year, which covers all fees, including tips. Customers extend one-time access to their InHome associate using an existing smart lock, a garage keypad or by purchasing a new smart lock from InHome for $49.95.
The delivery associate position is full-time at Walmart, and the retailer is paying $1.50 an hour over most current in-store roles in an effort to attract top talent. Management plans to fill many of the 3,000 new jobs with top performers in its current ranks. Drivers receive specialized training, both in-person and using virtual reality, to build the skill sets necessary to perform to the expectations on the job.
Discussion Questions
DISCUSSION QUESTIONS: Does the expansion of Walmart’s InHome program demonstrate that Americans are growing increasingly comfortable with the idea of giving retailers access to their homes? Do you think InHome customers are likely to be more loyal to Walmart than those who have orders delivered to their doorsteps or who choose curbside pickup?
Poll
Loading …BrainTrust
Jeff Weidauer
President, SSR Retail LLC
Rich Kizer
Principal, KIZER & BENDER Speaking
With over two years of experience, this significant expansion could only mean one thing: it’s working. At least it is for Walmart. The program isn’t for everyone, but for those consumers who are shut-ins – and almost who isn’t these days – or want the convenience of home delivery, this service will be very attractive. And, yes, InHome customers will no doubt be more loyal, just as Amazon Prime customers are. This is a bold move for Walmart and after two years of testing, I expect this to be a well refined and successful rollout.
I continue to be flabbergasted by the number of people that welcome delivery personnel into their homes. So, while I can’t imagine a day when my privacy standards will drop that low, I suspect younger generations must have different attitudes. And I learned long ago not to doubt Walmart’s data and the strategic directions to which it points — and if customers find real value in the in-home part of the delivery journey, I suspect the hefty fees will induce loyalty/share growth.
I’m glad that Walmart is serious about gaining entry into homes. The retailer – or any other – will never, ever gain access to mine. No matter how vetted they are, giving random strangers access to your home is crazy.
I agree with you Georganne. I can’t imagine giving strangers access to my home and even if I did, I don’t think the delivery person would enjoy being greeted by two large dogs.
Totally agree. I can see why (maybe) some Floridians are good with this, they don’t have to worry about their frozen products melting, but ultimately Georganne is right. It’s nuts, body cam or no body cam.
This. No matter how vetted these associated are and with bodycams on them, I would never allow a stranger access to my home. What happened to the food lockers that were being tested which sat in front of your home?
Giving people access to your home is the ultimate in building a bond with the brand, and I believe this is a brilliant move by Walmart. One key thing they’ve done is address the privacy concerns up front, and in every aspect. No third third-party couriers, for example, and body cams. This means every single access is on record and the couriers are accountable.
Having stores within 10 miles of 90 percent of the U.S. population doesn’t hurt. But without using their MFCs, or as they call them, CFCs, I don’t see how they could cover the volume they must expect with this delivery option. Basically, Walmart is doing everything right with their InHome project. They’ve piloted it in a smart way, so now the rollout, I predict, will go very, very well.
Walmart doesn’t roll anything out on speculation so obviously, the data collected from early tests support the expansion of InHome. Retailers have learned that convenience and choice are inextricably linked, even if some choices attract a smaller subset of shoppers. Walmart was one of the first retailers to understand this and to build out an arsenal of convenience options that make it harder for shoppers to justify shopping elsewhere. As with any number of seemingly unlikely or invasive services, customers who use InHome and have a great experience will spread the word and things will take off from there.
Actually they do many things on speculation. Their expansion of private label a few years ago was a disaster, the foray into apparel was ill-conceived and cost them a lot of markdown money to clear. Walmart often just throws stuff at a wall to see what sticks. That’s not bad, but I don’t think we can assume these decisions are data driven.
There’s a lot to be said for failing fast and Walmart has gotten better at that. I think it’s a matter of how success is defined and there are different standards for different tests. Walmart’s goal here is to own convenience and in that context, grabbing a smaller subset of early adopters can justify moving ahead.
This decision to roll out the service is no longer throwing it against the wall to see what sticks. The expansion is not speculation.
In-home delivery services may not appeal to everyone, but it appears that the success of Walmart’s pilot markets shows enough promise to expand. While there are a lot of security concerns from consumers, there is also a premium price that may deter large scale adoption. This is still a niche service and it gives consumers options. It will be interesting to see if other grocers follow Walmart’s lead.
While letting strangers into homes will give jitters to many, there is a critical mass of consumers who are comfortable trading privacy and security for convenience.
We should expect varying solutions that give a trade-off between security and convenience. An on-property solution with a secure fridge/shelf to drop groceries, much like a mailbox, or an in-garage solution that gives access to the garage code and not to the main home.
I also expect Walmart to offer fridges on three to five-year leases. A family of four committing to spend $250 on groceries could get a free replacement of fridge every five years, for instance. Appliances are one of those categories with long replacement cycles, and manufacturers like GE, Samsung, and Whirlpool should be very interested in partnering.
That’s a brilliant idea, then they use the free (smart) fridge to collect data on usage too. They have a patent on a vending system that is essentially a Walmart pantry in your home that is auto-replenished by a robotic delivery mechanism. I would assume this whole program is an early stage in their long game.
This may appear to be an incremental service upgrade to existing customers but, in actuality, this move absolutely expands Walmart’s customer base – they will get new, more affluent customers who will migrate from Instacart, Whole Foods and other grocery delivery services.
This is something to watch closely. There is certainly a market for this. As Mark has pointed out, for people who are housebound or people who really value convenience and just don’t have the time or the desire to shop or put away groceries, this will be a hit. I do wonder about the profit model for this. Retailers, Walmart included, have struggled with the costs associated with extra handling and labor requirements for very basic capabilities like curbside. This goes way beyond that and I’m interested to see what the fees will be and at what scale Walmart needs to operate this program to make it profitable.
I do applaud them for innovation and being willing to try this.
Walmart continues to push the narrative and boundaries in meeting the customer where they want to shop/engage with the retailer. This is just another example of Walmart giving the customer what they want – white glove service for loyalty.
Americans are growing more comfortable with giving retailers and service providers to their home because personal safety is addressed through cameras etc.
Walmart is coming correct with customer convenience, competitive pricing, and expanded product choices. InHome is a great initiative for Walmart and will help build deeper relationships with the customer, in turn driving increased brand loyalty.
Is it time to stop calling this an experiment or a trial? 30 million homes is a big number! This is a good strategy that goes head-to-head with Amazon and any other major retailer trying to break into the “InHome” delivery service.
I’d be interested to learn more about the insurance implications of this move.
Walmart is clearly seeing success with the InHome program, although its appeal escapes me. The question is whether other retailers will attempt to follow Walmart’s lead, and whether they will be as diligent in the vetting of personnel. The whole thing feels like risky business.
I don’t think you go into an area and have the success Walmart has had because people are growing increasingly comfortable with the idea of giving people access to their homes. Given the technology, they are just plain are OK with it. If the technology were available 10 years ago, one would see the same success.
Imagine the convenience of not trying to schedule your day around a promised delivery, or going by the retailer for their BOPIS program.
And, yes, this will increase customers’ loyalty to Walmart. It is every company’s desire to become the “go to” place and this does it for Walmart.
For years I (and others) have been relating the analogy of the milkman in this space to describe the challenges of last-mile delivery. Most of us born in the ’60s or before remember getting milk delivered to our homes once or twice a week. Gradually, however, shoppers began buying their milk and other dairy products from supermarkets and convenience stores, and the milkman was delivering to fewer and fewer homes. At some point, perhaps when only one-third of a neighborhood was buying from the milkman, it was no longer profitable for the dairy to continue the service. Walmart clearly sees a return to a customer penetration level that will ultimately make the InHome program profitable. Not sure I see this happening in 2022, but Walmart really doesn’t play the short-term game.
This expansion suggests consumers now prioritize convenience and retailers keep investing in earning their trust.
Saving time will be even more desirable when more consumers return to the office. Smart home tech, visibility and accountable talent can increase their comfort with Walmart’s in-home service.
InHome service differentiates Walmart, and its time savings and ease can boost loyalty among users who try the program.
Overall, leading retailers know that treating us like royalty deepens our loyalty.
This is a neat idea – but not a new one. Waitrose in the UK commenced trialing their “while you are away” service a number of years ago. It has been suspended since the start of the pandemic.
If done well it does create potential increased loyalty and may potentially remove one of the last areas of friction in grocery shopping – putting it in the cupboards! But this is tricky as delivery operatives are unlikely to know which cupboard!
In an environment where people are out at work all day and items are left for the customer to put away when they return it has serious potential – the benefit that Walmart can smooth demand over the day rather than having an evening for peak deliveries. Where customers give access to garages or other out-buildings it could even be done at night when customers are asleep – in much the same way as milk has been traditionally delivered. (As an aside, I recently saw a meme highlighting how for over a generation milk was delivered to UK households in re-usable glass bottles, using an electric vehicle on a subscription payment basis. Ironic given current trends.)
Nope. No. Never. I have vehicles in the garage that I actually never show many people. Now some person I don’t know wanders inside when I’m not watching? Inconceivable! This may work for home-bound clients if it is as easy or easier than going to the front door for them. I don’t want anybody looking in, wandering around in or knowing what is inside my garage.
This option may not be for everyone but Walmart’s test market results indicate that some portion of the market will use this service. It reminds me of the saying, “Success in marketing does not come from everyone liking a product a little, but from some customers liking it a lot.”
What I love most about Walmart is that they don’t bundle the entire consumer market into one and call it a day. There is clearly a market segment for in-home delivery. InHome customers have already bought into the solution, have established ways to reduce worry about their food supply through designation of lockers, garage space, a porch or patio. While I don’t believe they will saturate the 30 million household market (~20 percent of all residences) they will have enough business to justify 3,000 drivers and charge $148/year. There will be an overlap between this service and those of ultrafast grocery delivery services like DoorDash, Instacart and the VC backed emerging players -e.g. Buyk, Gorillas, Jokr and more – though the differentiator won’t be delivery time.
Walmart has found something that it appears many people want. My personal response is, no, it is not a service I would ever use. I do not want service people to be entering my home when I am not there, regardless of how well they are trained.
It’s being offered. Let’s not — at this point anyway — read too much into it.
While many have benefited from the convenience of at home grocery delivery this past year, this is ambitious, even for Walmart. Sending their delivery teams going into garages–maybe (someone has to combat porch poachers). But going into homes and refrigerators feels like we’ve just crossed some sort of virtual line. Notwithstanding a deadly virus mutating amongst us, how many consumers leave their homes ready for “viewing” before heading out for work in the mornings?
Can most consumers appreciate the idea of having grocery shopping done and put away by the time you get home from work? Certainly. Do most consumers want Walmart in their refrigerator with recording camera? Probably not.
For a certain customer, I can see this being wonderful. I think most consumers will not be comfortable with people entering their homes and rearranging their refrigerators (and who knows what else). I can see how it would be relatively successful in Vero Beach (think seasonal residents that don’t keep much in their home or are long-term renters, elderly that are homebound, etc.) but for the typical customer I doubt they would be willing to let go of the privacy. I know I would not.
I do wonder if a “locked” cooler of some sort at the doorstep could be an intermediary step. I do think that once customers sign up for a service like this, they must be insanely loyal (profitable) clients.