By the end of this year, over 40 percent of American households will enjoy the option of having their groceries delivered by Wal-Mart.
In an attempt to compete with delivery giant Amazon, Wal-Mart announced on Wednesday that the company is expanding their grocery delivery service to over 100 metro areas across the country.
The company plans to utilize their expanded delivery option through transportation services like Uber by the end of the year. On a call with the press, Wal-Mart’s vice president of digital operations referred to the new initiative, saying, “We will be pretty aggressive with it.”
Wal-Mart already offers curbside pickup at 1,200 stores nationwide, and plans to expand that program to another 1,000 stores by the end of 2018.
With revenue growth slowing at Wal-Mart in the past quarter, the company’s most recent move is seen as an effort to keep up with Amazon, who recently purchased Whole Foods.
But the competition is stiff: Amazon just announced a free, two-hour Whole Foods grocery delivery service for their coveted “Prime” customers in four markets. Parts of Austin, Cincinnati, Dallas and Virginia Beach are currently serving as pilot programs prior to Amazon’s planned expansion of the service in 2018.
John Mackey, Whole Foods Market co-founder and CEO announced, “We’re happy to bring our customers the convenience of free two-hour delivery through Prime Now and access to thousands of natural and organic groceries and locally sourced favorites. Together, we have already lowered prices on many items, and this offering makes Prime customers’ lives even easier.”
Wal-Mart charges a $9.95 delivery charge with a minimum order of $30. Earlier this month, the low-cost chain rolled out a meal-kit offering and a variety of “One-Step” fresh prepared foods —a seemingly perfect complement for the company’s new grocery delivery service.
Delivery services from local grocers like Peapod and HyVee have been offered for years, but larger corporate giants entering the market serve as formidable threats.
According to MarketScale, “reseachers say that the increase in online shopping, video streaming, and employees working from home have turned Americans into homebodies.” These trends have driven the demand for the delivery services of consumer goods, resulting in a decline local in retail sales, which is now carrying over to the convenience of grocery delivery services.