Mar 7, 2024 - Business

Exclusive: Walmart opens new front in same-day delivery war

Illustration of a grocery bag speeding into the frame.

Illustration: Gabriella Turrisi/Axios

The same-day delivery wars are heating up with Walmart and Target adding speedy new services that rival Amazon Prime.

Why it matters: Intensifying consumer demand for instant gratification — like having everything from milk to a barbecue grill delivered in hours — is putting pressure on all retailers.

Driving the news: Walmart launched an early morning on-demand delivery service Thursday where orders placed at 6am are delivered in an hour or less, the company shared exclusively with Axios.

  • There's a $10 express fee for all orders and a base delivery fee for shoppers who are not Walmart+ members, Tom Ward, Walmart U.S. executive vice president, told Axios.

Between the lines: The announcement comes two days after Target said it is introducing a subscription program with unlimited same-day deliveries to grow sales.

  • Ward said Walmart's timing was tied to the switch to daylight saving time on Sunday to give shoppers more "time back."

The big picture: Same-day delivery sales and subscription programs are big business for retailers as consumers who use the services tend to shop more frequently and spend more money.

  • "People's expectations keep growing and we want to meet them where they're at," said Ward, who is Walmart's chief e-commerce officer. "They want more speed, more options and more convenience."
  • Walmart+ members spend 76% more than the average Walmart shopper, according to a Numerator report released this week.

How it works: Walmart's orders come from the retailer's 4,700 stores, which act like fulfillment centers, Ward said.

  • Walmart shoppers have two different morning express options: an hour or less for a $10 fee or delivery in three hours for $5 plus other fees for those who aren't Walmart+ members.

By the numbers: Walmart+ costs $98 a year or $12.95 a month and includes free same-day delivery for orders $35 or more and other benefits like free Paramount Plus and a gas discount.

  • Target Circle 360, which launches April 7, is being introduced at $49 for the first year and will increase to $99. Target Circle Card holders, previously RedCard holders, can sign up for $49 at any time, the retailer said.
  • Amazon Prime costs $139 per year or $14.99 per month and includes free delivery, streaming, music and other services.

More from Axios:

Go deeper