Walmart to test in-home delivery program

Remember when you had to go down to the mailbox or onto your doorstep to pick up items you ordered online?

If a program Walmart is testing takes off, people may be asking that question within the next several years. The program will allow delivery drivers to leave packages inside a customer’s home, and groceries in the fridge or freezer, TechCrunch reports.

“…we want to do more in the future by delivering groceries and other orders in whatever location works best for our customers – inside the house for some and in the fridge/freezer in the garage for others,” said Sloan Eddleston, Vice President of Walmart’s eCommerce Strategy & Business Operations, in the official announcement.

When the delivery driver arrives at a participant’s home, he will enter a one-time passcode on an August Home smart lock to gain entry. Walmart says customers will be able to watch the driver enter and move around in their houses via a video feed on their smartphones. When the driver exits the home, the door will lock automatically.

Walmart has hired same-day delivery service Deliv to perform the deliveries themselves. Sam’s Club, a Walmart affiliate, partnered with Deliv in March 2016 to test a grocery delivery program.

This most recent pilot program will be available in Silicon Valley to a select group of August Home users who have chosen to participate. As TechCrunch points out, if the program is successful, Walmart may expand the list of supported smart-home providers beyond August Home.

TechCrunch further notes that Walmart has not indicated how long the program will run, nor whether the company intends to expand the trial to locales outside of Silicon Valley.

Walmart says it has designed the test to gauge how much customers are willing to pay for the service. The company has yet to disclose a pricing model.

Walmart has partnered with smart-home companies to enhance delivery operations in the past. In June, online retailer jet.com, which Walmart acquired in August 2016, teamed with Latch to install high-tech lockboxes on the front doors of 1,000 apartment buildings. Among other functions, the system allows customers to remotely grant access to their apartment complex so that drivers can deliver packages even when the customer is not home.

In its continued effort to keep pace with online retail giants like Amazon, Walmart has experimented with other augmentations to its delivery operations, TechCrunch notes. The company offered a discount to customers who had online orders shipped to Walmart stores, and tried allowing in-store employees to deliver packages from the store to customers’ homes.

In emulation of Amazon Prime, Walmart instituted a two-day shipping option that is free for rewards members.

In June 2016, the company tested a system whereby Uber and Lyft drivers delivered groceries to customers’ homes. Customers ordered groceries online, paying a $7 to $10 delivery fee. Then, a Walmart employee culled the requested items from the shelves, placed them in a bag, and called an Uber or Lyft driver to pick the order up from the store and deliver it to the customer’s home.

Meanwhile, Amazon—arguably Walmart’s chief competitor—is making its own efforts to cut delivery times. Through that company’s Prime Now program, customers can have tens of thousands of items delivered to their doors in less than an hour.

Amazon also offers grocery delivery and one-hour restaurant delivery through its Prime membership program

Moreover, the company is testing autonomous drones that can deliver items weighing under five pounds in 30 minutes or less. Last December, as part of a pilot program in the UK, Amazon completed its first drone delivery. The company says it is working with regulators to get Prime Air, as the service is called, off the ground around the world.

Featured image via Hurlburt Field

Amazon Instant Pickup will give customers their orders in two minutes

In this age of instant gratification, eCommerce retailers like Amazon face a dilemma. A consumer can make a purchase in seconds with a few clicks of a mouse or taps on a screen—it doesn’t get much more instant than that. Then, though, customers must wait for days or weeks before they get their hands on the purchased item.

It is arguably the last advantage brick-and-mortar stores have over the eCommerce industry: when customers make a purchase at a physical store, they can walk out with the item(s) in hand.

So, Amazon is making a continuous effort to shorten delivery times—to close the gap between the “buy now” click and the unboxing of the goods. In October 2014, the company launched a same-day pickup service which allowed customers to pickup items ordered before 11:45 am by 4:00 pm the same day, at one of a number of locations throughout the nation and around the globe.

A few months later, the company rolled out PrimeNow, through which Amazon Prime customers in select locations can get household essentials like paper towels and shampoo, small items like books and toys, and even big-screen televisions delivered to their doors in two hours at no added cost, and in one hour for an additional $7.99. Amazon even partnered with restaurants and grocery stores in certain markets to offer delivery from those locations.

Tuesday, the giant announced another leap forward, Reuters reportsAmazon Instant Pickup. The service lets customers pick up their orders within two minutes. It is currently operational only in Berkeley, CA and Los Angeles, CA, per Amazon’s website. According to Reuters, the program will expand to college campuses in Columbus, OH; College Park, MD; and Atlanta, GA in the near future, and to additional locations by the end of the year.

When a buyer places an Instant Pickup order, an Amazon employee culls the purchased item from the shelves and puts it in a locker, which is sealed using a unique bar code. When the customer arrives at the pickup location, they can scan the barcode, open the locker, and retrieve the item.

Amazon considered automating the fulfillment process, Reuters says, decided against doing so at this time. Automation could occur down the road, though.

The service will cater toward impulse buyers: the majority of the several hundred different products available at Instant Pickup locations will be high-volume, quick-purchase items like phone chargers, snacks, and drinks. The last two offerings will make Instant Pickup an alternative to vending machines.

“I want to buy a can of coke because I’m thirsty,” said Ripley MacDonald, Amazon’s director of student programs, per Reuters. “There’s no chance I’m going to order that on Amazon.com and wait however long it’s going to take for that to ship to me.”

That is, MacDonald says, until Instant Pickup came along.

However, Forrester analyst Amanda Chakravarty told Reuters that while the new service will be convenient for some items, vending machines will not disappear anytime soon. “[Instant Pickup] might work for some electronic gadgets that are not commonly available at vending machines,” she said. “Two minutes is too long to wait for a soda can.”

But, many analysts expect Amazon to build Instant Pickup into something beyond a high-tech vending machine: a full grocery store.

“This is a natural extension of [Amazon’s] larger push into the grocery space,” Morningstar analyst R.J. Hottovy told Reuters.

Amazon acquired Whole Foods in a $13.7 billion deal in June. TechCrunch notes that Amazon could make Instant Pickup available at some or all of Whole Foods’ 467 physical locations. Customers could build a grocery cart on their way to the store and pick up their food when they got there. Moreover, the Whole Foods stores have plenty of space for inventory, so Amazon could make them Instant Pickup locations for a host of products beyond food.

In eliminating shipping costs, Instant Pickup may allow Amazon to reduce prices, Reuters points out.

Featured image via Flickr/Robert Scoble

Amazon Marketplace to Roll Out New Return Policy in October

Amazon is amending its returns policy to make it easier for customers to return items they purchased from third party sellers, Ari Levy of CNBC reports. Under the new policy, customers will be able to return such items directly through Amazon, without contacting the seller.

The eCommerce giant will also enable “returnless refunds,” meaning merchants can reimburse customers without requesting an item back. According to Levy, Amazon says sellers have advocated such a policy, which would allow them to forgo the cost and hassle of facilitating the return of an item that may be defective, expensive to ship, and/or hard to sell.

CNBC broke the news after an Amazon merchant forwarded the news agency an email he/she had received from the company. Amazon said in the e-mail that sellers will have a choice as to whether or not to offer returnless refunds on a given product, and will be able to “set rules” defining the circumstances under which a refund is issued.

Still, many sellers are expressing displeasure with the policy on the forum linked to above. One merchant said of returnless refunds, “In other words, customers get things from us for free! Is this a joke?” Another said, “Amazon is going to assume that a buyer would NEVER lie about the reason for the return so they don’t have to pay for it.”

The unidentified merchant who forwarded Amazon’s email to CNBC said the return policy “will totally crush small businesses that fulfill their own orders.” He/she means that the policy targets those who list items on Amazon but ship them directly to buyers without using the Fulfillment by Amazon option.

The Fulfillment by Amazon (FBA) service allows third-party sellers who meet certain requirements to make use of Amazon’s fulfillment and customer service operations. FBA sellers store their products at Amazon fulfillment centers, where Amazon employees manage packaging and shipping. FBA merchants can sell their products under the Amazon Prime banner, meaning they can offer customers free two-day shipping. Amazon charges merchants for storage space and per fulfilled order.

Amazon also handles customer service and yes, returns, for FBA members.

The coming change is another move in Amazon’s ongoing effort to provide a uniform experience for customers, regardless of whether they buy from Amazon directly or from a third-party seller.

Levy points out that Amazon’s first concern is maximizing customers’ happiness. Easing the return process simplifies the consumer experience. The new system will “provide customers with an easy and efficient return experience,” Amazon’s email to merchants said.

The new system will allow customers to print return shipping labels prepaid for by sellers, and to deal with Amazon exclusively throughout the return process.

“Certain items,” though, “are not eligible for prepaid return shipping,” according to Amazon’s email, and merchants “can request exemptions for specific items in your inventory.”

Amazon says “early participants [in the new shipping system] have seen RDR [Return Dissatisfaction Rate]  go down by an average of three times after offering prepaid return shipping.” Some on the forum, though, say RDR is a skewed metric. One seller, under the username Lake, said RDR “provides provides better ratings for sellers with lots of returns than sellers who sell good products [and therefore] get fewer returns.”

“It proves that Amazon has no clue what the business issues are” from the seller’s perspective, “Lake” wrote.

Sellers who are dissatisfied with Amazon have limited alternatives, Levy points out, especially if they have already built a thriving business on the site. According to an article published on MarketplacePulse in December, 1,000 sellers join amazon.com everyday. Amazon has twice as many users (i.e. buyers) as eBay, according to a February report by Leanna Kelly of cpcstrategy.com

“Speaking strictly in terms of revenue and growth potential, Amazon blows eBay out of the water,” Kelly adds, although she goes on to admit that eBay has some “clout” by other measures.

By virtue of its number of users, Amazon has all but forced sellers to use its site. When the company, ever faithful to the retail maxim of serving the customer, makes a change that favors consumers at the expense of sellers, sellers have little recourse.

The changes will go into effect on October 2, but those who wish to can apply to begin “authorized prepaid returns” as early as August 25.

CEO of Etsy Steps Down

The online commerce company Etsy announced on Tuesday that its current chief executive would be replaced. The handmade and eclectic goods website reported lower first quarter profits than expected and it’s facing pressure from investors.

Once the leader in handmade items, Etsy must now compete with Amazon.com Inc.’s newly release marketplace. Despite a recent lower rating from Pacific Crest, Amazon’s success as a leader in e-commerce is not easily fought against. Etsy claims to combat Amazon’s mega-success with a wider range of products.

Josh Silverman, a former executive of eBay Inc. and current Etsy board member, will take over as chief executive this week. He is replacing Chad Dickerson whose loyal service to the company includes leading Etsy through its initial public offering.

While Dickerson could be called the impetus for Etsy’s growth into a well-known, even “trendy”, entity, redirection is perhaps in order. The valiant efforts of the company to remain ethically responsible often cut into profits.

The influence of a former eBay executive may be exactly what the company needs at this time in its development. Silverman’s strategies will be important to follow in the coming months.

A Hunt for New Prospects                                                        

Fred Wilson will replace Dickerson in his role of board chairman. Wilson has served as a board member since June of 2007 and a lead independent director since October of 2014.

In addition to leadership changes, Etsy stated the intention to cut about 8 percent of its workforce by eliminating 80 jobs. The change is an effort to save money after recent attempts to rebrand.

The past quarter saw unusually high costs as a percentage of revenue partially because of this change in marketing. Furthermore, employee expenses for the site experienced a jump for unreleased reasons.

Silverman plans to continue a strong marketing campaign without drastically raising expenses. With the site’s drop in popularity, a face-lift appears to be necessary.

Recent Failure

Analysts were disappointed with Etsy’s stock this quarter as 1 cent per share earnings were predicted. Instead, the company lost $421,000 over the course of the first quarter. This includes $2.1 million lost from interest expenses and other charges which went towards the company’s new headquarters.

This is a let-down after Etsy’s earnings of $1.2 million the previous year. Furthermore, the company’s predicted revenue of $98.4 million was not met. They instead reported a revenue of $96.9 million.

Etsy hoped to attract higher numbers of buyers to their site in the first quarter, especially with new branding methods. However, it reported slower growth in item value, gross merchandise sales, and a key metric.

The company declines to provide the usual financial forecast for this week because of the change in management. Analysis by the company of earlier months reveals decreases in consumer spending as a major cause of the slow-down.

An Impetus for Change

Black-and-white capital LP, an Etsy shareholder, reacted harshly to the company’s recent downturn. It requested early Tuesday that Etsy separates the roles of CEO and chairman and attempt further changes.

Black-and-white owns 2 percent Etsy and is, therefore, concerned about the company in the face of growing competition. It also critiqued the website’s search functionality. Plans to change this are currently in the works.

For now, the management change leaves some investors uneasy. In after-hours trading on Tuesday, Etsy’s stock decreased 17 percent. The future is uncertain for the e-commerce site.

Style.com’s Move to E-commerce

Style.com is getting a makeover with their transformation into an e-commerce website.

President of Condé Nast, Bob Sauerberg, told Business of Fashion that their plan is to move the style portion to Vogue, and concentrate e-commerce into Style.com. This culmination of content will result in Voguerunway.com.

The way the transition will work is that Vogueontherunway.com will feature content that can now be found on Style.com.

Vogue.com will feature news related to fashion and features.

Although these goals may seem too ambitious for an online publication, in recent months they’ve received in an influx of visitors.

Businessoffashion.com said, “according to statistics provided by Condé Nast, Vogue.com has seen 160 percent rise in unique visitors for Q1 2014 to Q1 2015, as well as a 345 percent lift in traffic from social media during the same period.”

It was recognized that there were redundancies in content on Style.com and Vogue.com, so the merging of the two websites just made sense. Style.com has already built a name for itself, and Chairman and Chief Executive of Condé Nast, Jonathan Newhouse, told BoF, “It was decided that [Style.com] was a really great brand name for what we want to do with e-commerce.”

Fans of both Vogue.com and Style.com will be able to get all of their style needs met at Voguerunway.com

Style.com already has their planned laid out. In autumn, the e-commerce website will launch in Britain, and they will focus on targeting “fashion brands as well as upmarket brands from other sectors such as beauty, travel services and technology.”

Eventually the e-commerce will move to North America and Asia. The reason that e-commerce is beginning in Britain is that e-commerce is larger there than it is in America.

The company has been diligent with their preparation of this project. They have incorporated big names like ASOS Editorial Director Melissa Dick.

In the announcement of the launch, Newhouse explained how he was confident in the launch, seeing as their websites already had an audience of over 300 million.

Newhouse told Vogue that preparation for this has taken longer than anything else he’s ever done because it’s something that he hasn’t done before.

President of ecommerce at Condé Nast, Franck Zayan, will govern over the business.

According to Vogue.co.uk, Zayan has experience with “e-commerce for the Paris department stores of Galeries Lafayette.

Fans of the website should expect to see this transition occur over a period of time.

According to Style.com, until the transition is complete, “keep coming to Style.com for our daily fashion show coverage, industry news, parties, street style, and more.”

No information has been released as to what brands will be offered on the website. The collections offered will be through Condé Nast editors.

Photo: Style.com