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Wednesday, March 27, 2013

Wal-Mart Introduces Lockers as It Battles Amazon in E-Commerce

Following Amazon.com, Walmart will soon allow shoppers to order items online and pick them up from lockers in local stores.

The introduction of lockers is part of Walmart’s effort to become a superstore online and on cellphones. It announced several e-commerce and mobile tools on Tuesday at a news event at the San Bruno, Calif., headquarters of @WalmartLabs, its digital commerce arm.

“We’ve dramatically accelerated customer acquisition online,” Neil Ashe, chief executive of Walmart global e-commerce, said at the event. “We’ve got to be there. We weren’t there before and now we’re realizing the benefit of that.”

The point, Mr. Ashe said, is to offer Walmart products anywhere a consumer wants to shop, whether in stores, online or on a phone. What he didn’t say is that Walmart is also fighting Amazon, the biggest online mall, which has been encroaching on its turf.

At one point, responding to a reporter’s question about Amazon, Mr. Ashe asked, with a smile, “Who”

Though Walmart’s total sales far exceed Amazon’s, its e-commerce sales are a fraction of Amazon’s. Walmart is on track to generate $9 billion in e-commerce revenue this year, Mr. Ashe said. Amazon’s revenue, most of which comes from e-commerce, is expected to exceed $65 billion this year.

Walmart’s major e-commerce advantage, said Joel Anderson, chief executive of Walmart.com, is its 4,000 stores. They provide a network of distribution points for things like same-day shipping and in-store pick-up. That is particularly helpful for the quarter of Walmart customers without credit cards or bank accounts who previously were excluded from e-commerce, he said, because they can order online and pay with cash in a Walmart store. To start, the lockers will be available this summer in about a dozen stores in one market, which Walmart declined to name. Customers can avoid shipping fees and pick up their items whenever it is convenient, 24 hours a day at some stores, without interacting with a clerk. Lockers also help consumers who are not home during the day to receive packages and cut down on delivery costs and logistics for retailers.

Amazon, which introduced lockers in 2011, has been expanding the service in chains like RadioShack and 7-Eleven and local stores. Google, which has been experimenting with retail delivery, recently bought a start-up called BufferBox that provides e-commerce lockers.

Walmart is also testing a new home page. It has three tabs â€" one for traditional online shopping, one for browsing items that are popular at the moment on Pinterest and search engines and one with personalized information from a shopper’s local store. Walmart recently built a new search engine for the site, which has increased sales 20 percent, the company said.

To compete online, where price and selection are most important, Walmart uses software to monitor prices at competing retailers in real time and lower its prices accordingly, said Kelly Thompson, senior vice president of merchandising. It is also doubling the inventory sold from third-party retailers in its online marketplace and tracking search data patterns and social media to choose trendy products, she said.

Walmart is testing a new mobile app for shopping in stores. Shoppers can add items to their lists using voice or by scanning bar codes. When they enter the store, the app directs them to the aisles where their items are located. It keeps a running total of the items in shoppers’ carts, offers digital coupons and receipts and lets people check out themselves and order items online if they are not available in the store.

Already, 12 percent of e-commerce sales through Walmart’s mobile app comes from shoppers using the app in Walmart stores, the company said. Over all, a third of Walmart’s e-commerce sales come from mobile.