Dive Brief:
- Walmart’s U.S. sales using store-fulfilled delivery have more than doubled over the past two years as the retailer continues to prioritize faster shipping, President and CEO John Furner told analysts during a May 21 earnings call.
- More than 36% of deliveries from stores arrived in three hours or less in Q1, with faster speeds fueling customer engagement, EVP and CFO John David Rainey said. He added that sub-hour options are growing the fastest.
- “We can now reach approximately 60% of the U.S. population in 30 minutes or less,” Rainey told analysts. “And customer satisfaction with our delivery offering reached record highs.”
Dive Insight:
Walmart has made efforts to accelerate delivery speeds as it looks to compete with Amazon, leveraging its assets such as stores, clubs, distribution and fulfillment centers and last-mile networks to drive faster deliveries, Rainey said.
“And the importance of speed, the reason to highlight that is fast fuels frequency,” Rainey said. “When we see that we are able to deliver to customers in the time frames that they expect, we see a much greater engagement with our customers.”
Overall, Walmart is seeing stronger engagement across its fast delivery categories, with sales in the sector growing more than 50% year over year, according to President and CEO of Walmart U.S. David Guggina.
Walmart Fulfillment Services has also seen growth in faster shipping activity, with units shipped same day or next day up nearly 150% in Q1, per Rainey.
Walmart’s drone program continues to be a critical part of the retailer’s faster delivery strategy. In Q1, the retailer hit its 1 millionth drone delivery, with a little more than 40% of those drone deliveries operated last quarter, Guggina told analysts.
“And on average, these orders were airdropped to our customers' homes in just minutes,” Guggina said.
Currently, Walmart’s drone delivery program is available in 66 locations across four states, including Texas, Georgia, North Carolina and Arkansas, Guggina said. By 2027, Walmart plans to scale its drone delivery coverage with partner Wing to more than 270 store locations.
