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Summer has become prime time for sales in ecommerce. This year, Walmart is kicking off the savings season with a new three-day event.
Walmart+ Weekend is set to run from 3 p.m. EST on Thursday, June 2, to 7 p.m. ET on Sunday June 5. It offers access to deals for new and existing members of Walmart+, the company’s subscription offering.
While Walmart has run summer sales events before, this is the debut for Walmart+ Weekend. An early look at the deals is already available through this site. It lists 10 categories, ranging from food to fashion and pet products to patio and garden.
Walmart said thousands of sales will be available (while supplies last). In promotions, the company detailed some of the deep discounts on offer, like 50% off a Levi’s Boys 2-piece outfit, $200 off a Shark Auto Empty Robot Vacuum and a Hover-1 Blast Hoverboard for $79. Some sales are designed for this season, like a Coleman above-ground pool that is $100 off. Others look toward the next, like school supply staple Elmer’s Glue, which is 28% off.
To help promote the event, the retailer lined up a host of celebrities that will be sharing on social media during the weekend, including comedians Jim Gaffigan, Ken Jeong and Franco Escamilla.
For shoppers, there is plenty on the surface level to attract interest. Look a level deeper, however, and it’s clear Walmart is putting strategy to work with this event. From the date to the design, it's the latest sign that Walmart is making aggressive moves to grow Walmart+. Let’s break down the key points:
Samsung. Keurig. LEGO. Scroll through the deals that are already available, and it’s clear that one of the big draws of this event is the deals from name brands. It shows how these deals events can help to bolster brands.
“With this seasonal event, our goal is to align our supplier campaigns with these moments to optimize relevancy for customers and drive impact for their brand,” Walmart said in responses provided to The Current.
Walmart’s ability to curate discounts from recognizable names serves to help draw shoppers to the event.
By holding an ecommerce-focused event in the summer, Walmart is adding the kind of offering that most might expect from Amazon.
In 2015, Amazon introduced Prime Day to offer deals on items at a time that’s typically slower for retailers. It has since altered the annual sale calendar, updating the idea of “Christmas in July” for the ecommerce era. This means deals extend beyond Amazon, as Prime Day’s famed halo effect leads many retailers to line up special events around the same day.
Walmart was one of those retailers that ran such events Last year, it held Deals for Days on the same date as Prime Day. In 2019, the name of the event was less clear, but the timing of lining up thousands of sales with Prime Day made the intent unmistakable.
This year, Walmart is looking to roll out its deals extravaganza before Prime Day arrives. Amazon announced in April that Prime Day will be held in July. But on May 18, Walmart announced that its deals event will be taking place at least a month earlier.
Here's where we should make one thing clear: Walmart hasn't directly addressed whether or not it is competing with Prime Day.
“Building upon the success from our Early Access events during Black Friday, we decided to create an entire weekend dedicated to our Walmart+ members,” the company said. “This three-day-sales event is slated for early June to offer more savings exclusively to our Walmart+ members timed to the start of summer.”
Prime Day has the desired knock-on effect of adding to the membership ranks of Prime, as Amazon seeks to grow its subscription program by offering deals that are only accessible on that day. Given this goal, the others who promote their own sales around Prime Day are indirectly advertising Prime, even as they try to benefit from the scale of the event.
By holding its own event at least a month earlier, Walmart can center its own membership program.
Subscription-driven businesses are increasingly powering the consumer economy. With Walmart+, the world's largest retailer sought to harness its scale, and create a more seamless experience between in-person and digital shopping.The company launched the program in 2020, positioning the program as a “life hack" for shoppers that chose to opt into the membership.
It came at a time when ecommerce was growing. The company's infrastructure was long seen as a potentially huge advantage in online shopping, as 90% of the U.S. population living within 10 miles of one of its roughly 10,500 stores. With demand increasing in the pandemic, it bolstered ecommerce and fulfillment capabilities. At the same time, more customers were opting for curbside pickup, and the company stood up a two-hour delivery option to match customer expectations.
A subscription business could help the company put each of these to work for returning customers. With Walmart+, initial features included free delivery from stores, free shipping from Walmart.com, access to a Scan & Go feature that allowed customers to pay via app as they shopped in stores and a 5-cent-per-gallon fuel discount at stores.
The new offering underscored where Walmart was heading. With ecommerce adoption skyrocketing, the company was becoming an increasingly digital business. Walmart started to see stores as both in-person shopping centers and fulfillment hubs. With a heavily trafficked website that included a third-party marketplace and new media capabilities, it had a $2 billion advertising operation by the end of 2021. The subscription business was another area where Walmart adopted the principles of web-based businesses. To boost interest in Walmart+, Walmart started rolling out the kinds of partnership-centered, user-friendly moves to grow subscribers that are often employed by consumer tech companies. Initiatives in recent months included:
- Increased fuel benefit: Walmart+ expanded its fuel benefit to 10-cents a gallon, and expanded the number of participating locations to more than 14,000 by adding Exxon, Mobil and Murphy USA stations.
- Spotify partnership: Starting in early March, new and existing members received six free months of Spotify membership.
- American Express partnership: In October 2021, Walmart announced that members who used an American Express U.S. Consumer Platinum Card could receive a statement credit that covers the cost of Walmart+ membership.
These are all designed to bolster Walmart+ membership. Offering a path into the program through an American Express card makes it easy to sign up. Discounts on fuel and streaming audio add benefits to membership that can keep interest beyond a 30 day trial. At the same time as the Spotify partnership, the company announced that employees would receive Walmart+ membership for free, further adding to the membership numbers.
Deal events, in turn, are a part of this equation. The company has previously offered access to discounts to members on Black Friday. In February, Walmart held what it dubbed a Black Friday-like discount event for members. With Walmart+ Weekend, it is adding an event for summer. All of these events can help attract new members who see them promoted, and want to sign up to get access to the discounts.
So while the timing is near Prime Day, there are signs that Walmart+ Weekend could be part of a distinctive Walmart+ strategy that competes with Prime Day. Walmart is forming its own star, rather than continuing to operate in Amazon's orbit.
Still, the subscription programs offered by the two companies have plenty of similarities beyond a summer savings event, from the delivery guarantees to the different entry points through media.
While it is following a distinct path, Walmart is also looking to build a business that goes beyond retail in Amazonian fashion.
The company is adding financial products via the launch and acquisition of fintech startups led by former Goldman Sachs execs, which are now operating under the banner of ONE. Adding further financial talent, it also brought on former PayPal CFO John Rainey as its new CFO.
“We can help our customers and Walmart+ members save money, have an experience with less friction, and help strengthen the financial position for millions of families,” CEO Doug McMillon said of its fintech plans on the company’s Q4 2021 earnings call.
With financial services, Walmart+ could have the makings of offering a “super app” style service that can add payments and even banking functions alongside shopping. There are plenty of ways for Walmart+ to help the company drive loyalty, offer exposure to its expanding roster of services and provide first-party data that is increasingly desired by brands as they seek to market products.
"Plus is an important piece of the flywheel," Walmart US CEO John Furner said on the company's recent earnings call.
One area that’s still unknown is how far Walmart+ has to go to compete with Prime’s audience of 200 million members. The company hasn’t released data on the program’s membership, but Deutsche Bank estimated it had reached 32 million households in September 2021, indicating it had reached an “inflection point” with higher-income shoppers.
“Walmart+ is a unique retail membership and we remain focused on providing benefits and incentives that appeal to our customers,” the company said. “We will continue to listen to feedback and provide the best possible deals, events and benefits for Walmart+ members.”
Summer of deals?
The deals event comes at a time when discounts are in focus.
In 2021, supply chain challenges made it difficult for retailers to secure products to sell, leading many to stock up. As bottlenecks let up, they are now dealing with excess inventory.
Add to that a backdrop of 40-year-high inflation. Shoppers are spending less on apparel and big-ticket items as prices on food and fuel rise. Discounts could help to move more of those items.
Even before the event was announced, Walmart leaders said on the recent earnings call that they were planning rollbacks on items in an attempt to reset inventory levels, which were up 33% in the first quarter.
“Most of the increased inventory and related costs were related to buying over the past several quarters with a keen focus on in-stock, and now we're in a short period of rightsizing it,” Walmart CFO Brett Biggs told analysts.
He added that the company expects that to last two quarters, so Walmart+ Weekend likely won’t be the last sale opportunity at Walmart this summer, in whatever form it takes.
Trending in Retail Channels
Applications are open for startups interested in the 12-week Store Nº8 dCommerce Base Camp.
Walmart incubation arm Store Nº8 and Web3 accelerator Outlier Ventures are teaming up to support retail startups.
The organizations opened applications this week for the Store Nº8 dCommerce Base Camp accelerator. The virtual program will offer education, funding and mentorship to startups building solutions in Web3 that are designed for the retail and commerce experience.
Focus areas for selected startups will include decentralized infrastructure, data and growth solutions, immersive experiences and the metaverse and the intersection of AI and blockchain technology.
“We think dCommerce represents a huge opportunity to unbundle ecommerce into its constituent parts, and into a more decentralized and composable stack of protocols to create a more efficient, equitable and improved experience for retailers and consumers from CRM to last-mile delivery," said Outlier Ventures CEO Jamie Burke, in a statement. "There is clearly no better partner than Store Nº8, as Walmart's incubation arm, so we are thrilled to launch this accelerator program together.”
Beginning in mid-August, founders will take part in a 12-week program. The cohort members will receive funding and access to subject matter experts from Store Nº8 and Outlier Ventures. They will also receive support from industry mentors in areas such as product roadmap development, the token economy and fundraising.
“Decentralized commerce has the potential to unlock new value in the global commerce ecosystem, so we are excited to partner with Outlier Ventures to support and engage with entrepreneurs building at the forefront of this technology on their path to scale," said Store Nº8 VP Thomas Kang, in a statement.
The new program arrives in the year after Web3 and the metaverse saw a spike in interest from brands and retailers, as the arrival of immersive platforms opened up new digital environments where consumers gathered. Walmart entered the metaverse through an activation on Roblox, and also introduced a platform for digital collectibles. But it remains a nascent space, so there’s room for startups bringing fresh ideas to help larger enterprises develop capabilities. Alongside connections that help startups move forward, such learning is one potential outcome of the accelerator could last beyond the 12 weeks.
Applications for the accelerator are available here.