Wal-Mart pairs with Deliv, Uber and Lyft to test online grocery delivery
June 3, 2016 11:20 AM
(Bloomberg)—Wal-Mart Stores Inc. will begin testing the delivery of groceries using Uber and Lyft drivers, aiming to match the convenience of services offered by Amazon.com Inc. and other e-commerce companies.
The retailer will start trying out Uber in Phoenix and Lyft in Denver within the next two weeks, Wal-Mart’s chief operating officer of e-commerce, Michael Bender, said in a statement. The company previously began a pilot program in March using Deliv to deliver Sam’s Club groceries and other merchandise in Miami.
The move steps up competition with Amazon’s burgeoning grocery-delivery service and provides a potential new avenue of growth for Uber and Lyft. The idea is to let Wal-Mart customers pick out groceries online and then have employees fill the order and give it to one of the ride-hailing companies’ drivers. Shoppers will pay a $7-to-$10 delivery charge to Wal-Mart to have the groceries brought to their door.
Greater use of technology was a theme of Wal-Mart’s annual meeting on Friday, with CEO Doug McMillon pointing to e-commerce spending and sales-floor advancements. He also used the new Facebook Live service to connect with associates.
“Our investments in education and training, store structure, wages, hours and sales floor technology are to support you and enable you to serve your customers and members,” he said.
The delivery push has taken on greater urgency as Americans shift more of their spending online. Wal-Mart previously began offering home delivery in Denver and San Jose, Calif. It also encourages customers to place orders online and pick up the goods at stores—a bid to capitalize on its thousands of U.S. locations.
“We’ll start small and let our customers guide us, but testing new things like last-mile delivery allow us to better evaluate the various ways we can best serve our customers how, when and where they need us,” Bender said.
Wal-Mart, based in Bentonville, Ark., made the announcement ahead of its annual meeting on Friday. Wal-Mart is No. 4 in the Internet Retailer 2016 Top 500 Guide; Amazon is No. 1.
The retailer’s shares rose 0.6% to $70.95 in New York on Thursday. Wal-Mart has climbed 16% this year.
At the meeting, shareholders approved the company’s slate of directors, which cut the size of its board to 12 directors. Four existing members, including former CEO Mike Duke and founding family member Jim Walton, decided not to stand for re-election. Aida Alvarez and Roger Corbett also are retiring from the board.
Steuart Walton, the grandson of founder Sam Walton and the son of Jim Walton, was the only new board member added. With the current makeup, independent directors account for about two-thirds of the body. A measure to require Wal-Mart to have an outsider as its chairman was voted down at the meeting.