BENTONVILLE, Ark. -- Wal-Mart is bringing its in-store pickup towers to 80 more locations over the next several months as the retailer pushes further into e-commerce. The first tower appeared in the retailer’s hometown Bentonville, Ark., last year. At least 20 stores already have the machines today.
These pickup towers are imposing orange structures with “Pickup” plastered on the sides. They reach at least 16 feet high and are about 8 feet wide. To pick up a package from the tower, customers scan a barcode on their phone or a printed sheet of paper. Just 45-seconds-or-less later, a conveyer belt deposits the package with the customer.
These in-store pickup towers are a next step in Wal-Mart's online ordering strategy. It also has tested parking-lot grocery vending machines, as previously reported in CSP Daily News.
Here's a look at how the pickup towers work, what they mean for the brand’s online ambitions and other headways the brand is making into online shopping …
The convenience factor
In addition to serving as eye-catching, high-tech advertising for its online ordering service, the pickup towers simplify a previously overcomplicated process, according to the company.
Before Wal-Mart rolled out the pickup towers, customers picking up an online order had to find an employee, wait for him or her to track down their package out of the back and then show security the receipt on their way out. Now, customers don’t need an employee to pick up a package, and the towers sit near the front of stores so security can see customers collect their packages.
To further sweeten the deal, Wal-Mart is letting customers save as much as $50 when they pick up large items such as flat-screen television sets from stores.
Keeping up with the Amazons
Business Insider reports that Wal-Mart has also tested pickup lockers—similar to Amazon’s lockers—but decided the pickup tower was the better option. Unlike lockers, which are the same shape no matter what package it holds, these towers can adjust the size of the compartments where it stores packages.
Between its vertical build and its ability to shift compartment sizes, it seems to be an improvement on the locker model. The wider rollout of these pickup towers could be a signal from Wal-Mart that it’s not just interested in recreating Amazon’s online success. It wants to do better, at least on some fronts.
Made (and sold) in China
Pickup towers aren’t the only front in Wal-Mart’s battle to compete with Amazon online.
Reuters reports that Wal-Mart is looking for suitable vendors in China and other countries to widen its online audience. Wal-Mart began reaching out to sellers in China, the United Kingdom and Canada in February, according to Reuters.
Data from Marketplace Pulse suggests that Wal-Mart’s third-party online marketplace makes up more than 10% of Wal-Mart’s e-commerce revenue. A similar marketplace from Amazon that also uses global vendors contributes to nearly half of Amazon’s retail sales, according to Reuters.
The big-box retailer also appears to be shedding some staff to shift more attention online. Talk Business and Politics recently reported that Wal-Mart is laying off “a few dozen” employees.
The retailer would not confirm which areas of the business the layoffs will affect, but Wal-Mart CEO Doug McMillon has said that the company is investing in technology and cutting corporate positions for “more speed, less bureaucracy and lower costs,” according to Talk Business and Politics.
How these moves will play out long-term remains to be seen, but Wal-Mart is clearly not giving up e-commerce territory to Amazon without a fight.