Walmart E-Com Sales Soar 30% in Q2

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Walmart E-Com Sales Soar 30% in Q2

By Jessica Binns - 08/20/2013
Walmart's second quarter sales climbed 2.1% to $68.7 billion, driven by omnichannel investments in e-commerce logistics, updated mobile applications, expanded online inventory, products available for pick-up in store and rolling out fulfillment capabilities to an increasing number of supercenters.
 
In the first half of 2013, Walmart's e-commerce sales soared 30% and the retailer doubled its online inventory partly by increasing the number of sellers on its marketplace, with the goal of doubling its Web product offerings again by year end. It also added new Web order pick-up capabilities with the Washington, D.C., pilot launch of Amazon-style lockers, which 90% of users have positively rated, CEO Bill Simon said in a recent earnings call.

Further still, Walmart continues to look for ways to increase the e-commerce profit margin. "We are piloting new programs in logistics to lower the cost of delivery and improve profitability for e-commerce orders," added CFO Charles Holley on the call.
 
The retailer improved its mobile offerings for Sam's Club, with an updated mobile app contributing to a 25% increase in basket size and a revamped mobile website leading to a twofold jump in sales compared to the prior quarter. Shoppers using the Walmart smartphone app can now search store inventory via voice recognition or barcode scanning with a new integrated shopping list feature.
 
"Given the shift in online traffic from desktop to mobile, we're the first major U.K. retailer to launch a dedicated tablet website for non-food business," added Doug MacMillon, CEO of Walmart International. The company also refreshed its Scan & Go mobile checkout application and developed a version for Android devices.
 
Walmart's omnichannel ambitions rely on investments in its core global technology platform; expanding services and capabilities in four key markets; and enhancing a growing fulfillment network that merges online assets with its vast transportation fleet, distribution centers and stores. The retailer has added fulfillment capabilities — both ship from store, and in-store pickup — at 35 additional stores, and the number of products eligible for its same-day pickup program has more than tripled since January.  
 
"We have developed a new capability that automatically searches our broader inventory for an item if that item isn't available in a customer's primary store," explained Neil Ashe, president of e-commerce for Walmart. "That has significantly improved our fill rate."
 
"A steadily increasing percentage of all items shipped to customers' homes are now fulfilled through the Ship from Store program," added Simon. "The majority of orders are delivered in two days or less and at a lower cost."
 
Walmart installed 1,400 additional self-checkout lanes in the second quarter, and usage increased by 4% year-over-year. This kind of customer-centric convenience may be a factor in why the retailer's customer experience ratings were higher compared to the quarter prior.
 
With the acquisitions of Tasty Labs, OneOps, Inkiru and Torbit, Walmart has tapped into Silicon Valley innovation that offers technical expertise invaluable to improving areas such a search in its global tech platform, according to Ashe.
 
"Our mobile and online technology investments increased customer engagement and drove double-digit sales growth for walmart.com," said Duke.
 
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