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Walmart undermines Amazon's latest member advantage and launches next-day free shipping on hundreds of thousands of products.
Walmart's next-day service, which applies to orders of a minimum of $ 35, will be deployed Tuesday in Phoenix and Las Vegas, Walmart said. It will be available to 75% of US buyers by the end of the year and will continue to grow next year, said Marc Lore, CEO of eCommerce at Walmart, Business Insider.
Unlike Amazon Prime, which costs $ 119 a year, Walmart's next-day shipping requires no subscription fees. And Walmart's run will cost less on shipping than two days, as each order will be run from a single distribution center, Lore said. In comparison, Walmart's two-day orders can be processed from multiple installations and into multiple boxes.
"The shipping costs will definitely go down," Lore said in a phone interview.
Read more: Forget the day – to – day expeditions: the same day is the "real battlefield" where Amazon, Walmart and Target face each other.
Deploying Walmart's next-day delivery comes less than three weeks after Amazon revealed its intention to reduce the default shipping speed of its Prime program to one day.
Lore said the calendar of corporate announcements was only a coincidence.
"We had planned to make this announcement several months ago," he said, adding that Walmart had begun investing in infrastructure for shipping the next day, there are more than two years.
Last month, Walmart hinted that a deployment of the next day's shipping was imminent. Soon after Amazon announced that it would speed up the premium shipping, Walmart tweeted: "Free shipping in one day … no membership fees. That would be revolutionary. Stay tuned." # 39; listen. "
Read more: Walmart retaliates against Amazon in a sarcastic tweet attacking prime membership fees
Walmart's next-day shipping offer will initially only be available on a selection of up to 220,000 items, which will vary from region to region based on customer ordering habits.
Lore said the range would grow over time.
"We will continue to add products for the next day's shipping," he said.
The company is also planning to make "aggressive investments" in automation technology and boxing at its treatment centers in order to further reduce the costs of shipping the next day, he said. .
According to Sucharita Kudali, Vice President of Forrester Market Research, overnight delivery is expected to help Walmart gain market share and attract new customers who have never previously ordered from Walmart.com.
It will also increase pressure on Amazon to properly execute its own promise of shipping in one day, she said.
"There is this thesis for a few years that Amazon is untouchable – that it is this success story that rushes and that no one can catch up," she said. "I think what we're seeing is that it's not over in the retail business, there is still a lot of competition, and ultimately the customer wins."
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