Walmart says Amazon's grocery delivery fee will put a 'Whole' in customers' wallets – RetailWire - RetailWire

Oct 25, 2021

by George Anderson

Walmart wants everyone to know that, as of today, Amazon.com is adding $9.95 to grocery deliveries from its Whole Foods stores.

The retailer sent out an email today that read, “You may have heard that starting today, one grocery delivery service will start charging its customers $9.95 for every single delivery… That’s why, today only, Walmart is announcing that new customers who sign up for Walmart+, the membership that helps them save more time and money, will get $9.95 back. Because customers deserve a grocery delivery service that won’t leave a Whole in their wallet for delivery fees — whoops, typo.”

Consumers who sign up today for Walmart+ by 11:59 p.m. PT will be eligible to receive the $9.95 back. Walmart’s annual grocery delivery subscription program costs $98 a year. It includes free grocery delivery from local stores at the same prices as customers pay in-store. It also includes free shipping without a minimum purchase, discounts on fuel and prescription medicines. Members are also being given early access to Walmart’s three “Black Friday Deals for Days” events throughout November. Walmart’s cash-back deal today is part of the free 15-day trial it offers for customers considering a Walmart+ subscription.

Walmart is looking to give consumers who shop online at both Amazon and its site a reason to give its subscription service a try. The company is also looking to pick off some of the consumers who shop its rival’s site but not walmart.com. A recent Jungle Scout report found that 35 percent of U.S. consumers shop on Amazon, but not Walmart. Only nine percent shop on Walmart’s site but not Amazon’s.

Amazon-exclusive shoppers are more sensitive to delivery fee charges than even Walmart’s customers, according to the report. Seventy-six percent of shoppers who are “Amazon-exclusive” say they want products with the lowest shipping price when they shop online. Sixty-four percent of Walmart-exclusive shoppers feel the same way.

Walmart’s announcement today marks the latest back-and-forth between the two rivals. Amazon announced last week the rollout of in-store pickup and local deliveries for third-party sellers on its marketplace. Amazon Local Selling, as the program is known, seeks to address the perceived advantages of Walmart and others when it comes to physical store locations and convenient local fulfillment options. The service is now available from local independent stores, regional and national chains.

DISCUSSION QUESTIONS: Do you see Amazon’s delivery fee for Whole Foods as an opportunity for Walmart to convert some Prime members to Walmart+? How much of a threat is Amazon Local Selling to Walmart?

Braintrust

"I do think the Walmart campaign is really clever, but I just don’t see enough overlap between Whole Foods and Walmart grocery customers to move the needle all that much."