The last forty days have been a display of Amazon and Walmart battling it out on next-day delivery through press releases. It all started on April 25th when during the Amazon Q1 earnings call the company mentioned the upcoming Prime two-day delivery upgrade to one-day.
- April 25th. Brian Olsavsky, Chief Financial Officer at Amazon, “we’re currently working on evolving our Prime free Two-Day Shipping program to be a free One-Day Shipping program.”
- April 26th. Walmart tweets “One-day free shipping…without a membership fee. Now THAT would be groundbreaking. Stay tuned.”
- May 14th. Marc Lore, President and CEO, Walmart eCommerce U.S., announces “Free NextDay Delivery Without a Membership Fee.”
- June 3rd. Amazon confirms Prime Free One Day, “More than ten million products available coast-to-coast with no minimum purchase.”
It was inevitable for Walmart to take the bait and respond with their one-day delivery. Over the past few years, the company has set out to match - or try to do better - anything Amazon did. However, it was also inevitable for Walmart to match Amazon’s one-day delivery at a much smaller scale. After all, Amazon’s fulfillment infrastructure is still more substantial.
Today, Walmart one-day delivery is available for 130,000 products in four cities: Phoenix, Las Vegas, San Diego, and Los Angeles, according to Marketplace Pulse research. Ten million products are available on Amazon one-day delivery, in a lot more cities than four.
|One-Day Delivery||130,000||10 million|
|Two-Day Delivery||2.3 million||100 million|
|Number of Products||44.4 million||600 million|
It’s out of character for Amazon to mention figures like the number of products available with one-day delivery. The company rarely shares any metrics. Shira Ovide at Bloomberg wrote, “Amazon only seems to give meaningful glimpses at its financial metrics when it thinks doing so is helpful to the company or when regulators force its hand. Otherwise, Amazon prefers obfuscation by a bazooka of meaningless statistics.”
Shira then concludes, “The annoying thing about Amazon’s strategy is that it works.” In “Amazon’s PR genius”, Benedict Evans described that the company responds to all stories with “an Amazon spokesman declined to comment.” Except for two narratives: Amazon offers very good value, and Amazon is impossible to compete with.
Ten million products with one-day delivery is a narrative matching both of these. To consumers, this shows how overnight Prime membership became more valuable. For the competition, it raises the bar orders of magnitude above their current capacity - Walmart has 2.3 million products with two-day delivery nationwide, 20% of what Amazon promises on one-day.
For years to come, Walmart will be judged against the ten million finish line set by Amazon, even if few shoppers would notice the difference between five and ten million products available.