The Current, delivered daily.
Walmart is going conversational with its latest digital shopping tool.
The news: Walmart announced a new Text to Shop feature that allows consumers to place orders via SMS for everything from a gallon of milk to a new shirt. Available on iOS and Android, the service connects to a Walmart account.
How it works:
- Shoppers can text items that they need to Walmart, and they are then added to a cart. The full range of Walmart products are available.
- The feature learns frequently purchased items so that a person’s favorites are easily accessible. Shoppers can also type “reorder” to repeat past purchases.
- Checkout is completed via text or the Walmart app, and shoppers then pick a timeslot for delivery or pickup.
Key quote from Dominique Essig Walmart VP of conversational commerce, Store No8: “Text to Shop is simple and convenient by design, and was built in partnership with Walmart’s Global Tech team. We worked closely with our customers to design Text to Shop.”
Commerce gets conversational: As the mobile phone increasingly becomes the focal point of ecommerce, text messages are becoming a new place where brands and retailers are reaching consumers. After all, texts are a surface where people spend lots of time communicating. According to a recent survey from Clickatell, 78% of consumers want to use mobile messaging for shopping. Walmart’s feature shows that SMS-based ecommerce functions are going beyond offer messages for marketing, and becoming the surface for direct ordering to take place.
What stands out about Walmart’s tool:
- Assortment: Making the full selection of Walmart products available via text has the power to offer a huge range of goods. With Walmart’s prowess in groceries and consumables, the text function becomes a place where people can order every day items that they want to keep in stock, and not just discretionary purchases.
- User-initiated: Instead of getting a prompt or ad, users start the transaction with Walmart through text. That gives consumers control over what happens in their space, which is important in a private surface like text messaging.
- Omnichannel: With pickup and delivery, this feature is designed for local, regular ordering. That fits into Walmart’s strategy to have digital tools function across both in-store and online channels. Executives have said that the company sees more shopping online help sales in both places grow.
The sticking point: To request an item, customers have to know what they want. The tool’s ability to learn from past orders will help to fill in some of the items, but at this stage, the tool may tilt more towards ordering and replenishment, and less towards browsing.
An open question: Will there be an advertising opportunity? Walmart has emphasized its Walmart Connect retail media business with all things digital this year. A tie-in isn't clear yet, but brands should pay attention to see if one emerges.
Walmart’s holiday ecommerce experience list: This is just the latest new shopping feature from Walmart to be rolled out during the holiday season. In recent weeks, the retailer rolled out upgrades to the shopping experience that included a Buy button and discount tags, as well as augmented reality tools and a visual search feature.Joining the chat: Walmart’s feature is rolling out at the same time as Meta is making shopping a bigger focus of messaging-based service WhatsApp. The company recently talked about how it already has a $9 billion messaging-based ads business through the app, and is testing grocery shopping in partnership with Jio in India. It's clear that the companies that form the infrastructure of commerce see opportunity in text-based ordering. It's even more important at a time when they are looking to have more direct relationships with customers as a result of changes to digital marketing that will make attribution more difficult.
Trending in Shopper Experience
Campbell Soup Company CEO Mark Clouse offered thoughts on messaging amid inflationary shifts in consumer behavior.
After months of elevated inflation and interest rate hikes that have the potential to cool demand, consumers are showing more signs of shifting behavior.
It’s showing up in retail sales data, but there’s also evidence in the observations of the brands responsible for grocery store staples.
The latest example came this week from Campbell Soup Company. CEO Mark Clouse told analysts that the consumer continues to be “resilient” despite continued price increases on food, but found that “consumers are beginning to feel that pressure” as time goes on.
This shows up in the categories they are buying. Overall, Clouse said Campbell sees a shift toward shelf-stable items, and away from more expensive prepared foods.
There is also change in when they make purchases. People are buying more at the beginning of the month. That’s because they are stretching paychecks as long as possible.
These shifts change how the company is communicating with consumers.
Clouse said the changes in behavior are an opportunity to “focus on value within our messaging without necessarily having to chase pricing all the way down.”
“No question that it's important that we protect affordability and that we make that relevant in the categories that we're in," Clouse said. "But I also think there's a lot of ways to frame value in different ways, right?”
A meal cooked with condensed soup may be cheaper than picking up a frozen item or ordering out. Consumers just need a reminder. Even within Campbell’s own portfolio, the company can elevate brands that have more value now, even if they may not always get the limelight.
The open question is whether the shift in behavior will begin to show up in the results of the companies that have raised prices. Campbell’s overall net sales grew 5% for the quarter ended April 30, while gross profit margins held steady around 30%. But the category-level results were more uneven. U.S. soup sales declined 11%, though the company said that was owed to comparisons with the quarter when supply chains reopened a year ago and expressed confidence that the category is seeing a longer-term resurgence as more people cook at home following the pandemic. Snacks, which includes Goldfish and Pepperidge Farm, were up 12% And while net sales increased overall, the amount of products people are buying is declining. Volumes were down 7%.
These are trends happening across the grocery store. Campbell is continuing to compete. It is leading with iconic brands, and a host of different ways to consume them. It is following that up with innovation that makes the products stand out. Then, it is driving home messaging that shows consumers how to fit the products into their lives, and even their tightening spending plans.
Campbell Soup is more than 150 years old, and has seen plenty of difficult economic environments. It is also a different business today, and will continue to evolve. At the end of the day, continued execution is what’s required.
“If it's good food, people are going to buy it, especially if it's a great value,” Clouse said.