Walmart has already started to gradually transfer its customers to the new Walmart app that now places 50% of online grocery orders. WMT stock closed in the green yesterday but declined in the pre-market today.
Due to the coronavirus pandemic, Walmart Inc (NYSE: WMT) has seen an enormous increase in online sales. This week, the retailing giant has reported its Q1 2020 earnings, and it turned out its e-commerce sales soared by 74% year-over-year amid strength in grocery pickup and delivery services. In view of this growth, Walmart has decided to kill off its popular online grocery app but compensate for the shutdown by the launch of a new application.
According to Walmart CEO Doug McMillon, the online sales boost had three waves. The first one was the “stock-up phase,” which entailed “unprecedented demand in categories like paper goods, surface cleaners, and grocery staples.” During the second phase, items that adjust to a new “stay-at-home” style of living were on demand. Among them were video games, laptop computers, office chairs, sewing machines, sports equipment. Finally, the third wave began after Easter, it was “relief spending”. As McMillon explained, “discretionary categories really popped towards the end of the quarter.”
To handle this shopping traffic, Walmart has been working on a new Walmart app. Previously, its customers had to visit two different apps to access everything Walmart offers. In its online grocery app, customers could order food and some other categories of goods available for online ordering. In the Walmart app, there were all other products.
Refreshed Walmart App: Details
In March, Walmart announced its plan to unite the two apps on one platform. On Wednesday, the company said it had completed the merge, which happened six months ahead of schedule. With the new Walmart app, it will be much easier to make purchases. It has hundreds of thousands of new slots for online grocery pickup allows customers to reserve a no-contact pickup or delivery or order Express Delivery that takes less than two hours. In addition, the new Walmart app offers contactless Walmart Pay.
Walmart has already started to gradually transfer its customers to the new Walmart app that now places 50% of online grocery orders.
The initiative may give Walmart a competitive advantage over Amazon.com Inc (NASDAQ: AMZN) that offers grocery shopping via two services, Amazon Fresh and Whole Foods from both the main app and a separate Prime Now app for faster delivery.
Walmart Stock Up at the Close but Down in Pre-Market
Following the news, Walmart (WMT) stock rose by 0.40% on Wednesday to close at $125.45. However, it is slightly down in the pre-market trading today, at $125.00 per share at the moment of writing. Its market cap is $355.49 billion, the annual stock change is 5.56%.