Walmart tests limited same-day delivery of online orders

By Jessica Wohl

Oct 9 (Reuters) - Wal-Mart Stores Inc is testingsame-day delivery of televisions, toys and other generalmerchandise bought online in a few U.S. markets as it tries tofind new ways to keep up with competitors and to attract busyshoppers this holiday season.

The test of the "Walmart To Go" service began in NorthernVirginia and Philadelphia earlier this month and is set toexpand to Minneapolis on Tuesday, Walmart U.S. said. Walmartthen plans to expand the test to California's San Jose/SanFrancisco market in late October or early November.

The latest test comes as the world's largest retailer facesincreasingly sharp competition from Web retailer Amazon.com Inc

and others. The new test gives Walmart a chance toconnect its updated website with its thousands of stores inorder to make the chain more convenient to shoppers.

The test is not the only way that Walmart is working onmarrying the reach of its thousands of stores with its onlinebusiness. In September, Walmart U.S. President Bill Simon saidthat Walmart uses a group of stores around the country tofulfill online orders, which reduces shipping costs and time.

In that speech, at a Goldman Sachs event, Simon mentionedthat Walmart was quietly playing with same-day delivery but didnot say which markets may have been participating.

In the new test, shoppers in the Northern Virginia,Philadelphia and Minneapolis markets can pay a $10 flat fee forsame-day delivery of items picked from general merchandise itemscarried in local stores. Customers can chose an unlimited numberof those items.

Customers in those three markets must sign up, place theirorders by noon and pick one of three four-hour windows fordelivery later in the day. The goods are delivered by UnitedParcel Service Inc .

Some details of the test, such as the $10 fee, were postedon a website run by Kantar Retail IQ earlier this month.

In San Jose and San Francisco, Walmart already uses its owntrucks for online grocery delivery in a pilot that began in2010. Walmart will use its own trucks rather than UPS to deliverother goods there, and shoppers will still need to order by 7a.m. local time.

For now, Walmart To Go is only being tested in four marketsduring the holiday season, including the test in Minneapolis,the hometown of Walmart competitor Target Corp .

A Walmart survey found that the majority of respondents saidthat they would consider using same-day delivery. More than halfof the more than 1,500 survey participants said that they woulduse same-day delivery monthly or more frequently, Walmart said.

Walmart's other services offered nationally include Site toStore, where customers order online and pick up items at localstores; Pickup Today, which allows customers to pick out itemsonline to pick up the same day in stores; and Pay with Cash,where shoppers go online to pick out items and then pay for themwith cash in a Walmart store.

Pay with Cash, launched in April, has proven popular withthose who cannot or do not want to use credit cards to makeonline purchases. Pay with Cash accounts for 2 percent ofWalmart.com purchases, the company said.

(Reporting by Jessica Wohl in Cincinnati; Editing by Gerald E.McCormick)


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