Walmart Ups Drone Delivery Comp With Amazon, Expands Program to 6 States

Ask a Walmart executive, “What’s up?” these days and chances are they’ll say “drones.”

This as the retail giant announced that it is expanding its unmanned aerial delivery service with partner DroneUp to six states, with plans to complete 1 million drone deliveries by the end of the year.

In outlining the new initiative, a company blog post said the service area will include 4 million households and tens of thousands of eligible items weighing less than 10 pounds that can be brought to consumers’ homes in under 30 minutes for a $3.99 fee.

“As we scale our drone infrastructure, we’ll continue to influence the expansion of drone technology and enable other businesses to explore its benefits, too,” Walmart U.S. Senior Vice President of Innovation and Automation David Guggina said in the announcement, pointing to use by cities, insurance companies, real estate and construction companies as potential drone customers.

“Not only will the added revenue help offset the cost of delivery, but it also serves the entire drone industry by gathering more flight data as we work together to expand drone operations in a safe and regulated way,” Guggina added. 

Hamburger Helper

As described, Walmart’s drone service will be available from 8 a.m. to 8 p.m. from 34 participating stores and sites in Arizona, Arkansas, Florida, Texas, Utah and Virginia, and follows more than a year of testing and tweaks.  

Piloted by DroneUp’s FAA certified operators, orders will be processed, picked and packaged via special teams at stores before being loaded for delivery.  

Guggina said the expanding program has not only offered a growing body of technical knowledge but led to unique customer insights too.

“While we initially thought customers would use the service for emergency items, we’re finding they use it for its sheer convenience, like a quick fix for a weeknight meal,” he said, noting that the top-selling item at one location was Hamburger Helper. 

Eye on the Sky

Walmart’s drone news comes just one day after the retailer announced that it was tapping tech to expand another existing partnership via a deeper rollout and ramp-up of its robotic warehouse automation efforts with Symbotic, a move aimed squeezing new efficiencies and savings at a time when rising costs are shrinking the retailer’s margins and profits.

While still small, the company’s drone efforts are being positioned as another avenue of choice for consumers that will complement its other delivery options including express delivery and in-home or in-fridge grocery delivery service.

At the same time, the move is clearly aimed at matching efforts by Amazon’s Prime Air which has been undergoing a similar period of testing and expansion since its debut in 2016, as well as other competitors that are taking the skies as a way to save time and money completing final mile deliveries of things such as prescriptions and pizzas.

“I do want to set clear expectations: not everyone who lives within range of our drones will be able to order on Day 1,” drone operator Wing’s Chief Technology Officer Adam Woodworth said last month of the company’s expanded partnership with Walgreens. “We’re going to invite customers in groups to make sure everyone has a good first experience with drone delivery.”