Walmart is ending a nine-year test of pickup-and-delivery-only locations as the retail giant applies lessons from those sites across its broader retail footprint.
In-store and curbside pickup, along with delivery, emerged as the most popular trends to come out of pandemic innovations in contactless ways to retrieve online grocery orders.
Walmart was far ahead on the pickup concept in 2014, opening three pilot sites that were purely for curbside pickup or to fulfill online orders that year. Appropriately called Pickup Stores, one was near its Bentonville, Arkansas, headquarters, one in Lincolnwood, Illinois, and the third in Metairie, Louisiana.
Metairie closed last year, while the other two sites will close to the public by Feb. 17.
“We made the difficult decision to close our Lincolnwood Walmart Pickup location … and Bentonville Pickup location,” Felicia McCranie, director, corporate affairs, global communications, told PYMNTS.
“These decisions were not made lightly and were reached only after a thorough review process. As these are pickup-and-delivery-only locations, we have taken what we learned from these locations and made it part of how we operate Pick-up and Delivery from our surrounding stores, where we look forward to serving our customers and stores nationally,” she said.
See also: Study Finds More Consumers Now Prefer Pickup to Delivery When Ordering Online
Walmart, with nearly 5,000 U.S. locations, may be the nation’s largest retailer of groceries, but its move contradicts a shift that a growing number of its smaller rivals are embracing.
This, as consumers have taken a shine to the curbside and in-store pickup options, with the latter proving to have an additive effect of consumers buying additional items when going into stores to grab their orders, and being a major convenience breakthrough of the pandemic.
Alex Ruhter, CEO and co-founder of recently opened curbside grocer JackBe, told PYMNTS that “In the first month since we’ve opened, 50% — half — of the people that have come and tried our facility have come back for more than one order,” adding that “when you look at that trend across other areas in the food delivery kind of grocery industry, I believe we’re trending higher than what would typically be the average in that area.”
In late January, Addie’s, which bills itself as the “first drive-up grocer” on the East Coast, closed a $10.1 million seed funding round, showing that investors also see the appeal.
PYMNTS reported that Addie’s “uses its stores as fulfillment centers, closed to customers, in which eCommerce orders are fulfilled by store associates who bring them out to shoppers’ cars in the parking lot.”
See also: Amazon, Walmart Square Off Over Rise in Curbside and In-Store Pickup
McCranie told PYMNTS that pickup is now offered from over 4,570 Walmart locations, and same-day grocery delivery is offered from more than 3,550 stores, adding that “Walmart is constantly looking at ways to best serve the customer when and how they want to shop.”
Research confirms that these modes have scaled and gained serious traction with shoppers long after the COVID all-clear. The new “2023 Global Digital Shopping Index” (GDSI) a PYMNTS and Cybersource collaboration published annually, notes that, “Year over year, 26% more consumers across the five countries we studied used BOPIS [buy online, pickup in-store] options in 2022, as consumers appeared to favor the certainty and cost-effectiveness of pickup, and more merchants integrated pickup options into their order flows.”
In the U.S. — the world’s largest market for curbside — the 2023 GDSI said that “nearly one-third of U.S. consumers, or 16 million individuals, who made their most recent purchase online, picked it up in-store or curbside — a 37% year-over-year increase.”
Read more: Curbside Online Grocer Sees 50% Retention Rate With New Customers
That study noted an even bigger uptick in Brazil, where 25% of all online shoppers picked up their most recent purchases in-store, representing a 74% year-over-year increase.
Taking discoveries made at the three pilot locations to thousands of Walmart locations nationwide, Walmart is making it clear that the closings don’t reflect poorly on the performance of the sites or personnel, with the company planning to retain workers affected.
“We have been and will continue to be supportive of our store leadership and associates at these stores,” McCrainie told PYMNTS.
“This decision is in no way a reflection of their hard work and customer service. We are hopeful the associates at these stores will want to continue their careers with Walmart by transferring to another nearby store,” she said. “We employ thousands of associates in Walmart stores in the immediate areas of each facility. All associates in these stores will be eligible for transfer. We have invested in our associates, and we want to keep them in the Walmart family.”
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