Wal-Mart pickup program expanding into more stores nationwide.
The large, orange tower that made its first appearance in one of the state’s Wal-Mart stores last fall is becoming a noticeable feature in several other locations nationwide.
The Bentonville-based retailer said it is moving forward with plans to install pickup towers in about 100 U.S. stores, expanding a program that began at the Wal-Mart supercenter in Rogers. The structures stand 16 feet tall and 8 feet wide and were designed to work like a vending machine, dispensing general merchandise for customers who have placed orders online.
Jason Shaffer, senior director of central operations for U.S. stores, said the company’s decision to roll out the project on a larger scale came after the successful test.
“We haven’t released any numbers right now, but I will say we are very happy with the customer response,” Shaffer said this week. “Numbers continue to grow. Utilization of the tower continues to grow as our associates get acclimated with it and the customers get acclimated with it. So we’ve been very happy with how it’s gone.”
The towers, which are produced by Estonia-based startup Cleveron, are large enough to hold about 300 packages. Customers who order items online can walk up to the tower and scan the barcodes from their purchase receipts. The door slides open and the product is dispensed.
Large items such as televisions still must be taken to customers by employees, but Shaffer said Wal-Mart estimates that 90 percent of products ordered online by customers can be distributed through either pickup towers or lockers that are also being tested by the company.
Wal-Mart believes the machines will provide a convenient option for customers, eliminating the wait time and other drawbacks that can occur when trying to collect online orders.
“The biggest complaints we hear from our pickup business are we don’t have associates there,” Shaffer said. “I can’t find an associate. It takes 20 minutes to pick up. All of that is eliminated with the tower. The tower is there 24 hours a day, and you walk in and get your package anytime. That’s really that time saving and convenience we’re trying to drive.”
It’s also tapping into a growing trend in retail, according to a recent study.
Fifty percent of respondents to a JDA consumer survey said they’ve used buy online, pick up in store services in the previous 12 months. It was an increase from 35 percent two years ago.
“The towers are also yet another example of how WalMart is tackling convenience from innumerable angles,” said Carol Spieckerman, a retail expert and president of Spieckerman Retail. “Instead of attempting to steer shoppers into a couple of options, Wal-Mart continues to build a base of delivery options/mechanisms that ensure shoppers have little reason to shop elsewhere.”
The towers are one piece of Wal-Mart’s strategy to integrate its store footprint and growing online business in the retail battle against Amazon. com and other competitors.
Earlier this year, Wal-Mart began offering discounts for customers who chose to order items online and pick them up in stores. The company continues to expand its online grocery pickup service with plans to have it available at about 1,100 locations by the end of the year. Three stores — including one location in Northwest Arkansas — are using employees on a voluntary basis to deliver orders to customers on their way home from a work shift.
Wal-Mart is experimenting with other click-and-collect technology as well, including an automated grocery pickup kiosk. The kiosk, which is located in the parking lot of a Wal-Mart supercenter in Warr Acres, Okla., will operate 24 hours a day and allow customers to place grocery orders online and quickly collect them at the kiosk.
“Over the past few years, Wal-Mart has become quite proficient at testing and implementing any number of concepts or scrapping those that aren’t panning out,” Spieckerman said. “The willingness to step out and the courage to roll out are key to retail success these days.”
Wal-Mart is strategically selecting where it is installing pickup towers. The company declined to disclose the full list of about 100 stores where pickup towers will appear over the next several months, but announcements have been made in places like Glenpool, Okla.; Gilbert, Ariz.; Arbutus, Md.; and Auburn, Ala.
No other Arkansas stores have had towers installed, but a Wal-Mart spokesman said there will be more coming to the state by the end of the year as the company’s efforts in its pickup business accelerate.
“We’re making huge investments in our pickup business,” Shaffer said. “The pickup tower is kind of the cherry on top. It’s the best we’ve got as far as the technology we’re putting out there right now.”