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War of the supermarkets: Battle for last-mile delivery territory

War of the supermarkets: Battle for last-mile delivery territory
War of the supermarkets: Battle for last-mile delivery territory

It’s a grocery war between Amazon, Target and Walmart, in which the latter is investing millions to keep its market advantage. It launched an express on-demand early morning (6 am) delivery service this week. This allows customers to receive packages at their doorstep at dawn. 

But don’t rule out Target. A new paid membership program was announced and is due to be launched in April. What makes people pay for this? Free same-day home deliveries. 

Speed and precision. Those are the two things logistics expert Brittain Ladd believes are the most important of the decade in the grocery retail industry. Customers want deliveries when they need them when it’s convenient for them. Secondly, they don’t want to struggle with returns, lost packages, or missed deliveries. 

CNBC reports a fierce rivalry between retailers operating in the grocery space, trying to outmatch one another on convenience. Retail analyst Michael Bake told the publication that brick-and-mortar locations are Walmart and Target’s biggest “advantage over Amazon and other e-commerce players.” 

Walmart’s grocery game

Walmart is the largest grocery retailer in the US by market. According to a Numerator survey, the grocery market is valued at around $800 billion, and Walmart has the biggest sales share at nearly 24%. Walmart generates 60% of its revenue from selling groceries. 

For the last three months, Walmart has been offering faster grocery deliveries to customers. It’s even experimenting with drone deliveries for extra convenience and speed. 

But to keep its position, it can’t drop the ball; it has to continue to invest. 


ALSO READ: Walmart launches on-demand early morning delivery


Target’s paid membership program

Target’s latest paid membership program aims to chase new revenue streams. It’s expected to be launched next month and will cost just under $100 annually. There are a few perks for the subscribers, but any order over $35 will be delivered within an hour for free. 

Leadership has a significant impact on the output of a company’s strategy. In January, Target appointed Michael Fiddelke as the new chief operating officer. 

“Operations are at the heart of how we serve our guests, and I’m looking forward to spending even more time with our team members in the field as we build for the future,” says Fiddelke.

Is Amazon competing in fast groceries? 

Six months ago, Amazon announced a facelift to its grocery delivery plan. It bought Whole Foods Market in 2017 for nearly $14 billion. Now, Amazon is offering fresh food delivery to non-Prime members and is piloting computerized warehouses. 

Amazon is fixated on the technology used by Amazon Fresh stores. But Ladd believes this could be the one thing that keeps them from lapping Walmart in this race. “Customers fall in love with stores that offer the best assortment, deals, and shopping experience – not technology,” says Ladd.

He believes Walmart’s superpower is groceries and that the company must continue to investigate how to delight customers. If they don’t, Ladd warns, they risk losing the war to Amazon. 

NOW READ: Aldi’s rapid expansion: A threat to Amazon’s grocery dominance?

About the author

Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.

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