Walmart Tweaks Online Pricing Strategy

Walmart has begun differentiating between online and in-store prices to make the latter operations more profitable, The Wall Street Journal reported.The result is that some items, including many food products, are now priced higher online than in stores. The retailer's product listings may now show two prices, one for purchases that will be delivered to homes and the other for those that will be picked up in stores — often with a significant discount.During a recent check of walmart.com, for example, a four-pack of Velveeta microwaveable cups from Kraft Heinz Co. was priced at $4.93 for delivery versus $3.98 for in-store pickup. Similarly, a jar of tropical fruit from Dole Food Co. was priced at $3.17 for delivery versus $2.38 for in-store pickup. Along the same lines, seven 100-calorie packs of almonds from Snyder's-Lance's Emerald are $4.33 for delivery and $3.44 for in-store pickup.Packing and shipping products generally increases the cost of online sales, so raising prices to offset delivery costs is not uncommon. Yet the policy is unusual for Walmart, which has previously strived for price parity between its online and in-store merchandise as a way to offer both value and convenience — now shoppers will have to pick between the two.The retailer is testing the new strategy after first fine-tuning its free in-store pickup service and expanding it to 1,000 locations. The move also follows the introduction earlier this year of a "Pickup Discount" that the retailer positioned as a way to pass its last-mile delivery savings to e-commerce shoppers.Walmart additionally is asking suppliers to provide more products in bulk packages that can be shipped to consumers more economically, according to the Journal.Walmart currently is second behind Amazon in terms of share of online food and beverage sales, according to a new report from Packaged Facts that estimates Amazon will account for 18% share this year while Walmart will claim 9% share, and that online grocery sales overall will triple by the year 2022.In its own moves, Amazon recently went in the other direction to discount products from third-party merchants and eat the losses itself.

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