How Walmart GoLocal plans to stand out among delivery businesses

Walmart is a fresh face in the crowded delivery-as-a-service space, but the retail giant is looking to make its mark with a precise white-label delivery focus and by expanding fulfillment options to categories beyond food.

Since being announced in August, Walmart GoLocal has invited comparisons to companies like DoorDash and Instacart thanks to its same-day delivery focus. Yet there is a key difference between GoLocal and other providers: GoLocal doesn’t have its own customer-facing platform. Instead, its focus is to deliver orders made on its clients’ websites and apps.

“That’s a big differentiator, to be respectful of not disintermediating business-to-consumer relationships,” Harsit Patel, general manager of Walmart GoLocal, told Supply Chain Dive.

Walmart is rolling out its white-label delivery service at an opportune time. Demand for fast delivery boomed at the onset of the COVID-19 pandemic, as shoppers stayed at home and called for couriers to shop for their essentials instead.

In 2021, the U.S. quick-commerce market will total between $20 billion and $25 billion in retail sales, according to a Coresight Research report published in November. That’s a 10% to 13% share of its estimate for online CPG sales in the U.S.

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Courtesy of Shipt

 

“All indications tell us that what used to be a luxury, same-day delivery, is not just even a convenience anymore,” Shipt Chief Business Officer Rina Hurst said. “It’s become a must-have service.”

Rapid delivery expands beyond food

Same-day delivery has traditionally been a space for groceries, restaurant orders and everyday essentials ordered through customer-facing platforms. But providers are looking to deliver a wider array of products outside of these verticals, bringing more revenue and increased last-mile efficiency with them.

Still in its early days, GoLocal isn’t limiting itself to specific verticals. Walmart announced The Home Depot as the service’s first retail client in October, and Chico’s became its first fashion client in December. GoLocal is also pursuing deals with local firms.

“There’s a lot of smaller businesses that have been left out largely outside of the restaurant verticals,” Patel said. “We’re going to extend these services to any size of local business and then work with them to help them strengthen their relationships with their customers and primarily working as the white-label delivery provider for them.”

Retailers using GoLocal notify the service when an order made through its app or website is ready to be delivered, along with the timeframe and any additional parameters. GoLocal offers delivery times as fast as 15 minutes, Patel said. The service also can provide next-day delivery, but it’s not a fit for every business. According to Patel, most clients would want to fulfill next-day and two-day deliveries from a warehouse rather than local stores.

Walmart is making its push into white-label delivery as other companies begin ramping up services outside the marketplace format.

DoorDash has Drive, its white-label logistics service. In the grocery sphere, Instacart Connect allows retailers to run their own front-end storefronts while Instacart handles pickup and delivery. Shipt is also diving into delivery-only operations with Shipt Driven, which works off a retailer’s own website. Hurst said the last-mile service is an effective way for the company to reach more customers through new verticals.

“This is the fastest growing part of our business,” Hurst said of Shipt Driven. “Because this is on a retailer site, we can reach customers through so many different verticals, and our primary play is actually outside of grocery.”

Rapid delivery providers set to grow sales as their services diversify

Projected U.S. gross merchandise value sales at delivery intermediaries

Shipt Driven supports brands like Party City, Best Buy and Abercrombie & Fitch, Hurst said. Fellow delivery providers are also expanding into non-food verticals. Instacart has partnered with Big Lots and H&M Canada for deliveries. And Uber Eats is expanding the scope of what it delivers more each day, said Christian Freese, a senior director and GM for new verticals and delivery in the U.S. and Canada, in an email.

https://www.supplychaindive.com/news/walmart-golocal-new-delivery-business/617117/

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