It’s been reported that Walmart has made an agreement with Google to allow consumers to buy products via a virtual assistant. The new service, called Walmart Voice Order, will let anyone with a Google Assistant-enabled device do their grocery shopping by voice. Consequently, the feature will be available to millions of Google Home users as well as Android and Apple smartphone and tablet owners.
A Walmart press release noted that the corporation’s voice order system will be adaptive. As customers use the program, it becomes increasingly familiar with their preferences. For instance, if you love Jiffy’s Crunchy Peanut Butter Spread with Honey, it’ll know what you mean when you say “peanut butter” after a few orders. Moreover, the service is cross-platform, so users can add items to their shopping lists at home or on the go.
Tom Ward, the company’s senior vice president of digital operations, revealed Walmart Voice Order will be available in “the next few weeks.” Notably, Amazon has offered voice-controlled ordering via Alexa for some time.
As such, the hypermarket’s new Google Assistant partnership isn’t just a consumer-friendly bit of corporate synergy. It’s the latest salvo in Walmart and Amazon’s war for the online grocery market. As with previous conflicts between commercial titans, this battle of the brands is high-stakes. Forbes estimates online grocery sales will reach $100 billion by 2025.
Amazon Wants to be Your Online Grocery Store
The online grocery delivery wars actually began with the advent of Instacart. Founded in 2012, the California startup initially offered same day service from partner stores in Silicon Valley. Three years later, the company received a $2 billion valuation. Since then, the corporation has expanded into 1,200 cities throughout the United States.
Currently, Instacart serves more than 500,000 people across the country and brings in more than $2 billion in revenue annually. It should be noted that Instacart counts total customer orders as revenue, so its net profits aren’t quite as rosy as its income. Predictably, the firm’s explosive growth attracted the attention of other tech sector heavyweights, namely Amazon.
The corporation launched its first foray into the online grocery business in 2014 with Amazon Prime Pantry. The service allowed Amazon Prime subscribers to order nonperishable foods and household items for a nominal fee. In 2017, the Big Tech firm initiated Amazon Fresh, a perishable grocery delivery service available in select U.S. cities.
That same year, the e-commerce giant announced its intention to buy health supermarket chain Whole Foods for $13.7 billion. The organization’s move was significant for a few reasons. For one thing, the franchise’s 497 stores allow Amazon Fresh to serve a much wider audience. Second, the acquisition dealt Instacart a major blow as it ended the firm’s lucrative relationship with Whole Foods.
Amazon’s strategic development of its online grocery segment has led it to become the market leader. The firm now represents 18 percent of the total market and its fresh food segment brought in an estimated $2 billion in 2017. Walmart, the world’s largest grocery retailer, did not ignore this encroachment into its territory.
So Does Walmart
In 2013, Google created a halfhearted product to challenge Amazon’s dominance of the e-commerce market. The organization’s Google Express service delivers electronics, household items, office supplies, and some groceries. Currently, it offers goods from retailers like Target and Costco, but at one point it delivered nonperishable goods from Walmart.
From 2017 to 2019, the tech firm and the hypermarket enjoyed a presumably mutually beneficial agreement until Walmart disappeared from Google Express’s marketplace without explanation. However, mere days before ending Google deal, Walmart announced that it was greatly expanding its online grocery delivery service.
Protective of its market share, Walmart has been experimenting with home delivery for the last few years. Notably, the big-box franchise partnered with Uber and Lyft to bring its goods directly to consumers but it ultimately ended those partnerships as it developed its own logistics infrastructure.
Presently, Walmart is the nation’s second largest online grocery retailer, but the multination’s market share is half the size of Amazon’s. However, the corporation is quickly gaining ground on its rival by offering home food transportation from 1,600 of its stores by year’s end. Moreover, the company reported its e-commerce business grew by 40 percent in the first half of 2018.
Seemingly, Walmart’s recent successes have made it comfortable enough to unexpectedly partner with a rival. Alternatively, the organization’s renewed relations with a competitor make sense as its dealing with a larger threat. As opposed to dead brands like RadioShack, Circuit City, and Borders, Walmart doesn’t intend to lose this war to Amazon.