Amazon is rolling up its sleeves in its ongoing battle with Walmart. This time, it’s focusing on dominating the grocery delivery market.
Amazon reportedly is working on a plan to build brick-and-mortar grocery stores to more effectively compete against Walmart. These stores would be in addition to its 500 Whole Foods locations.
Keep reading to find out more about Amazon’s plan to build stores. We’ll also tell you why Walmart is a formidable foe.
Amazon tries to conquer the grocery delivery market
There’s no doubt that Amazon is most people’s first stop when shopping for tech gadgets, toys, movies, books, music and more. But, a head of lettuce and a bunch of bananas? Not so much.
Earlier this summer, Amazon announced a partnership with Rite Aid to provide same-day delivery of drug store items. At the time, Amazon officials said they were looking for more retailers to partner with in order to offer same-day delivery of groceries.
Even before acquiring Whole Foods, Amazon was thinking about opening stores with a fresh-food shopping area. Amazon does have physical stores around the country, but none offer fresh foods.
Now, there are reports that Amazon is working on a new low-price grocery store format that prioritizes online order pickups and deliveries. According to the New York Times, the stores would be smaller than those of major grocery store chains, but they would have a much larger storage area.
When asked for comment, an Amazon spokesperson told Komando.com that it does not “comment on rumors or speculation.”
By starting with a fresh blueprint, Amazon reportedly would have an advantage over grocery stores that are trying to retrofit their operations to make them more online friendly.
For example, making the stores smaller but having a larger storage area means that it would be easier for employees to restock items. It also means Amazon can keep more items in stock for online orders and same-day delivery or pickup.
The goal, from store to parking lot, would all be aimed at getting customers in an out of the stores quickly.
Walmart dominates in the grocery field
If Amazon is indeed making plans to build actual grocery stores, the company would have a long way to go to catch up with Walmart. In the U.S. alone, the company has 5,000 stores, of which more than 4,200 sell groceries.
Walmart plans to expand its curbside pickup service to 3,100 locations by the end of the year. But Walmart also dreams of offering same-day grocery delivery.
Walmart’s current grocery options allow customers to place their orders online and get free curbside pickup. It costs up to $10 to have same-day grocery delivery. It’s the latter that Walmart is focusing on now with its Delivery Unlimited subscription plan.
With Delivery Unlimited, you no longer have to pay for each grocery delivery. Instead, you can either pay $12.95 a month or $98 per year. The annual plan averages to a little over $8 monthly, which is considerably less than the $12.95 option — especially if you use the service more than once a month.
If you already shop for Walmart groceries online, the process is still the same. Shop via the Walmart Grocery app, checkout and select a time to pick it up or have it dropped off.
Walmart’s website shows that Delivery Unlimited is already available in several cities across 50 states.
Walmart playing catch-up with Amazon’s smart home delivery
In-home delivery at Amazon is nothing new. Amazon has been doing it for a couple of years with a service called Amazon Key. Prime members can opt-in for in-home deliveries using a smart lock kit, which Amazon sells on its website for about $200.
When you’re a Prime member and you buy something from Amazon, you can select the free in-home delivery option when you check out. On the morning of your delivery, you get a notification that you’ve got a package on the way.
When the delivery person arrives, your smart lock lets them enter your home through a door or garage. Because you’ve got the smart technology, you’ll get alerts that there’s activity in your home so you can watch the delivery.
This fall, Walmart will be piloting its InHome Delivery service in Pittsburgh; Kansas City, Missouri; and Vero Beach, Florida. As with Amazon Key, Walmart delivery drivers access your home through a smart device.
Walmart provides its delivery drivers with wearable cameras that allow you to watch the entire delivery live as it’s happening. Not only will Walmart bring your packages inside, but your perishables will be put in the refrigerator for you.