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Walmart takes on Amazon with same-day delivery

Walmart stores in a handful of cities will double as distribution centers as the online giant moves into super quick delivery.

The online store versus brick-and-mortar war has been going on for quite a while now. But for the most part it’s been Amazon on the offensive. It’s gone after bookstores, toy stores, electronic stores, Walmart, Target -- you name it. 

Well with the holiday season ramping up, Walmart is going on the offensive and offering same-day delivery for online purchases. Amazon’s been trying to make same-day delivery a part of its regular offering. But it faces a big hurdle. It’s an online store and it doesn’t have a physical presence in every state.

So while Amazon is ramping up construction of more distribution centers, Walmart -- which has 4,000 stores in 50 states -- has a head start, says Rebecca Lieb, an analyst at the Altimeter group.

“Because the merchandise is being shipped from nearby Walmart stores, Walmart is actually able to fulfill these orders” on the same day, says Lieb.

Here’s how it works: You pay $10, place an order online early in the day and your stuff is delivered in the afternoon. Right now, “Walmart To Go” is available only in a handful of states. The trial run will last at least through the holidays.

Lieb says that’s the plan anyway, but there are still a lot of questions.

“The jury is out whether this is going to resonate with consumers,” Lieb says.

In other words, is faster delivery enough to make Amazon customers switch to something new and untested?

Sucharita Mupuru, an analyst at Forrester, points out that Amazon’s business model is built on more than just shipping. It’s also based on technology.

“It is able to offer really favorable prices, they have everything from dynamic pricing algorithms that spider the web,” and other tricks to compete, Mupuru says.

Mupuru says even in the Internet age, big retailers like Walmart can use their stores to their advantage. She’s just not sure that using stores -- as distribution centers for super fast delivery -- is the way to do it.

About the author

Queena Kim covers technology for Marketplace. She lives in the Bay Area.

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