Walmart’s two-day shipping pledge comes with a caveat
Some Walmart.com shoppers are finding items listed online are “out of stock” — even when they’re in stock. The messages are arriving after the discounter determines those customers’ homes are too far away to profitability ship the item.
Previously, all items would be shipped when ordered, regardless of distance or shipping cost. A Walmart spokesperson told The Wall Street Journal that the new tactic aims to increase ground shipments from nearby warehouses and rely less on shipping by air to meet its two-day guarantee. Walmart also hopes to reduce split shipments, or online orders arriving in separate shipments from different warehouses.
Customers receiving “out of stock” messages are given suggestions for similar items available at closer warehouses.
The change, announced in August, has led to sales declines on certain products on walmart.com, motivating affected vendors to stock products at more Walmart warehouses around the U.S. to avoid losing a sale due to costly shipping.
The system is one used by Jet.com, acquired by Walmart in 2016. Under Jet.com’s algorithms, the closer the online shopper is to available inventory, the lower the cost. Online shoppers on Jet.com are also incentivized to purchase more items in a single order and opt out of free returns with the promise of bigger savings.
With Prime, Amazon.com has a qualifier that states its two-day promise starts “when the item ships” — not when ordered — and delivery may run past two days if the item is out of stock or unavailable to ship immediately. Under Amazon’s “Ship by Region” program, some items being sent by third-party sellers may not qualify for Prime’s guarantee because the seller has decided it’s too costly to meet the two-day window.
Retailers are encouraging their customers to use BOPIS and locker pick-ups as a way to combat rising expectations around speedy shipping. According to a survey earlier this year from AlixPartners, the maximum amount of time considered acceptable to wait for a package is an average of 4.1 days, down from 5.5 days six years ago. Amazon Prime members, on average, expect packages to arrive nearly a day earlier than non-members.
- Why Walmart Shoppers are Finding More Items ‘Out of Stock’ – The Wall Street Journal
- How are Shipping & Delivery Dates Calculated? – Amazon.com
- In New Amazon Prime Program, Not All Goods Arrive in Two Days – The Wall Street Journal
- Top trend in shipping? More consumers want fast and free – AlixPartners
DISCUSSION QUESTIONS: What do you think of Walmart’s move to declare an item “out of stock” if delivery costs are too high? Which steps being taken by retailers to reduce shipping costs — suggesting alternative items, offering incentives for bundling, BOPIS, etc. — do you think offer the best opportunities to keep customers happy?