http://www.businessweek.com/articles/2013-03-29/behind-walmarts-customers-as-delivery-men-idea-fear-of-amazon

Sales & Marketing

Behind Walmart's Customers-as-Delivery-Men Idea, Fear of Amazon


Behind Walmart's Customers-as-Delivery-Men Idea, Fear of Amazon

Photograph by Mischa Keijser

Wal-Mart Stores (WMT) is considering an unusual foray into the crowdsourcing/sharing economy: asking its customers to deliver purchases made by online buyers. As company executives told Reuters, they hope the plan, if implemented and if effective, would help Walmart compete with Amazon’s (AMZN) quick delivery service.

The idea, which is still in the brainstorming stage, would involve shoppers dropping off packages for online customers who live on their route back home. The retailer would offer a discount on the customers’ shopping bill, essentially covering the cost of their gas in return for the delivery of packages, said Joel Anderson, chief executive of Walmart.com in the U.S.

Give Anderson credit for thinking way outside the big box. Still, the plan is fraught with challenges, starting with shoppers’ willingness to participate. Wouldn’t they expect to be paid? There are also concerns about insurance, theft, and fraud. And how would people feel about random Walmart shoppers showing up with their packages?

Even if the idea never moves past the hypothetical, the fact that Anderson is even talking about it signals how serious a threat Walmart considers Amazon. On March 26, Walmart’s digital commerce division, @WalmartLabs, announced that it will soon allow shoppers to order items online and pick them up from lockers in local stores. Amazon introduced such a service in 2011.

Walmart’s total sales are far greater than Amazon’s, but its e-commerce sales are much smaller. Walmart expects $9 billion in e-commerce revenue this year, according to Neil Ashe, chief executive of Walmart global e-commerce. Amazon’s revenue, most of which comes from e-commerce, is expected to reach $65 billion this year.

Susan-berfield-photo-200x200
Berfield is a writer for Bloomberg Businessweek in New York. Follow her on Twitter @susanberfield.

Tim Cook's Reboot
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus