Sam’s Club, the wholesale branch of Wal-Mart, has widened its lead in ecommerce sales over nearest rival Costco.
The members-only warehouses had been lagging behind Costco owing to the latter’s superior locations, popular brands and greater appeal to the ethical shopper. The Wal-Mart group has been criticised by campaigners for offering a far less generous pay and benefits package to its employees than Costco does.
Now, Sam’s Club is fighting back with a new app featuring a click and collect option called Club Pick-Up, a facility that Costco has yet to offer. The app will allow customers to create online shopping lists, allowing easy re-ordering of regularly purchased products, and to notify stores that they are on their way to collect. Some stores even offer assigned parking spaces to Club Pick-Up customers.
Sam’s Club CEO Roz Brewer has placed ecommerce at the heart of her business strategy, saying that customers have come to expect the conveniences that Club Pick-Up offers. “Our members are telling us it’s one of their favourite apps”, she told Fortune magazine. Some Sam’s Club warehouses will also offer a Scan and Go service, allowing customers to check themselves out automatically, with exit greeters inspecting their shopping on the way out.
Meanwhile, Costco does not seem in a hurry to revamp its ecommerce offerings in response. Richard Galanti, the CFO of Costco, told business analysts on a conference call last month that he was concerned that customers would have less incentive to come into their stores, as it receives a large proportion of its sales through impulse buys. Not that Costco is resting on its laurels, however. Its ecommerce sales grew 19% last quarter, and it is quite possible that Sam’s Club’s lead could turn out to be a temporary phenomenon.