Amazon, Walmart Wage Ultra-Fast Delivery War
Both companies moved to expand their 30-minute-or-less ultra-fast delivery services across various US cities this past week.
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In the third decade of the 21st century, “30 minutes or less” goes way beyond pizza.
Amazon launched a 30-minute delivery service dubbed Amazon Now that provides “fresh groceries, household essentials and locally relevant items” in select markets this week, the e-commerce giant said in a statement. The move comes as fierce rival Walmart scours the nation for vacant storefronts to use as its own rapid-delivery hubs, according to a Financial Times report.
Tough Turf
In fact, Walmart has been expanding its hub footprint for some time now. Public filings show the big box behemoth has already opened delivery hub locations, dubbed Walmart Depots, in New Jersey, Dallas and Arkansas; the FT’s reporting revealed it’s exploring more locations everywhere from New York City to Florida and the Pacific Northwest.
Amazon, for its part, launched Amazon Now in Atlanta, Dallas–Fort Worth, Philadelphia and Seattle, with plans for a “rapid expansion” to dozens more US cities this summer. With the moves, both companies are attempting to encroach on each other’s territories:
- For Walmart, the rapid-delivery push is part of a broader effort to rapidly scale its e-commerce game and compete with Amazon. Last year, the company booked about $124 billion in e-commerce revenue; that’s up 24% year-over-year, but still pales in comparison with Amazon’s $588 billion in annual revenue, excluding web services.
- On the other hand, Walmart’s grocery business still wallops Amazon’s, though Amazon said in January that perishable grocery sales through its same-day delivery service grew 40 times over the past year.
In a Hurry: While Walmart’s existing network of 4,600 mainline stores has already provided a bedrock for run-of-the-mill same-day delivery, the Walmart Depots aim to solve a hidden problem: regular Walmarts are massive, and an army of delivery couriers has to navigate the roving bodies of regular customers. The much smaller and closed-to-the-public Depot locations allow delivery drivers to get in and out with much less fuss. Sounds to us like it may be time to revive “Supermarket Sweep.”
