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Walmart's new service suggests that the company is reconsidering ‘always low prices'

By Patrick McMahon, Rare.us
FILE PHOTO The Wal-Mart logo is displayed on the exterior of a Wal-Mart store in Oakland, California.
By Patrick McMahon, Rare.us

A Walmart subsidiary is testing a "personal shopping" service that allows customers to send text and picture messages to place orders with the store. Once placed, orders of "household items" will be delivered in 24 hours or less, according to Recode, while anything else will arrive in 2 days or less.

Returns made to Code Eight are free, and they’re picked up from a customer’s home or apartment building.

But it’s not for everyone. The new service is being tested in New York City and targeted at “high net worth urban consumers,” particularly “busy NYC moms.” This ain’t the Walmart you’re used to.

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In fact, it should sound more like Amazon Prime. Like Prime, Code Eight customers will eventually pay a subscription fee. The automation-intensive subsidiary — which says it’s investing in “machine learning, natural language processing, and personalization algorithms” — is focused for now on products in the health and beauty; household; and apparel and accessories verticals. Knowing Walmart, it won’t stay that way!

Walmart's $3 billion acquisition of Jet.com last year has helped the company shore up its e-commerce operations, according to TechCrunch. At the time, the company said they hoped to add to their customer base and improve users' shopping experience.

With this offering and the acquisition of trendy apparel makers Modcloth, Bonobos and outdoor retailer Moosejaw, the company makes it clear that they’re coming for the space currently dominated by Amazon and chasing after wealthier customers, not the “always low prices” and “save money, live better” crowds upon which Walmart built much of its empire.

Amazon customers, especially Prime members, tend to be wealthier than Walmart customers, according to RetailDive.

But it could be difficult for the Bentonville, Arkansas-headquartered company to make a shift like this while retaining its core customer group.

“They risk losing their most loyal customers,” retail futurist and author Doug Stephens told RetailDive after Walmart purchased Jet. “To move Walmart upmarket is a Herculean task.”

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