Walmart Inc. (NYSE:WMT) is working on its delivery service Walmart+, which will rival Amazon.com Inc.’s (NASDAQ:AMZN) Amazon Prime. This comes as Amazon has continued to dominate online sales thanks to its Prime service launched in 2005.
Walmart+ to compete with Amazon Prime
Over the last 18 months, Walmart has been working on its paid membership model that will comprise benefits that Amazon’s Prime service cannot match. Walmart intends to test the services as soon as March this year. The retailer has seen as Prime ascend to control online sales space, and thus, they have also pushed to have a service that will rival Prime as they try to grow their online sales. Currently, Amazon accounts for around 40% of all online sales in the US, with Walmart, which is ranked second, controlling only 5% of the online market.
The company will launch the services as a rebrand of the current Delivery Unlimited services that charge customers $98 per year for unlimited same-day delivery of groceries for any of its 1,600 locations across the US that offer the service. According to sources, the Walmart+ service will have a feature that will allow customers to place orders through a text. Interestingly the company may change the fee for the Walmart+ service, or they might try testing multiple price points.
Walmart+ comes with additional perks
However, in the long term, the company wants to offer additional perks to the Walmart+ service that may include fuel at Walmart gas stations and discounts on prescription drugs at its pharmacies. Similarly, they might provide a Scan & Go service that will enable customers to checkout in stores without having to queue. The company tested the service briefly before discontinuing it two years ago.
There are, however, no additional perks besides fresh grocery delivery that have been set in stone. As a result, this has led to concerns that the pressure to act might supplant a robust rollout plan. Interestingly it is yet to be seen of the $98 program per year will exclusively mean for grocery delivery will compete with Amazon’s Prime service.