Walmart is rolling out a new service via its website, walmart.com, that allows consumers to shop online for auto coverage, compare premiums, and sign up for a policy all in one sitting and from a single website.
It’s part of the giant retailer’s strategy to offer more financial services as it struggles to sell more to consumers in its stores, says retail consultant Burt Flickinger III at the Strategic Resource Group in New York.
“Whether it’s money transfers, or competing with GameStop on used videos, or auto insurance, Walmart is struggling to attract shoppers,” says Flickinger. “And the shoppers aren’t coming to the supercenters.”
Flickinger says Walmart needs to do something. He says same-store sales have been down for the past five quarters. Price-conscious consumers have been struggling to afford even Walmart’s discounted prices in the prolonged economic downturn, and Flickinger says Walmart has stumbled on customer service, with inadequate staffing and understocking of its stores.
“The auto insurance adds customer continuity and frequency, and Walmart has the second-biggest IT capabilities anywhere in America, second only to the Pentagon,” says Flickinger. “Walmart certainly has the size and scale to make financial services pay off.”
Walmart senior vice president Daniel Eckert explained Walmart’s new auto insurance as an at-home or in-the-office opportunity to compare quotes from multiple insurers, and to bind (actually secure coverage based on the quote offered)—without leaving its website.
The online market is hosted at the website of Walmart’s partner in developing the product, AutoInsurance.com. Eckert says the new service will be promoted at Walmart.com, and in displays at Walmart stores. It is being launched initially in Arkasnas, Louisiana, Mississippi, Missouri, Oklahoma, Pennsylvania, Tennessee and Texas, with rollout plans for the rest of the country later in 2014.