In the race for retail domination, Amazon and Walmart are putting increasing emphasis on the ability of shoppers to get what they want, when and where they want it. In a bid to win the high end digital sales war, Walmart has created a new invite only shopping experience called Jetblack. The service provides wealthy online shoppers with the ability to shop via text message, and to rapidly receive what they have ordered, usually the same day. Sarah Nassauer writes for The Wall Street Journal:
Epiphany Davis arrived at work in lower Manhattan on a recent morning, consulted her cellphone and set off by foot in search of products ordered via text message by wealthy New Yorkers.
From her company’s loft-like headquarters, Ms. Davis walked to a health food store to get SmartyPants Kids vitamins, but the variety was out of stock. Checking her cellphone often for instructions, she walked to a grocery store for a single bag of Guittard milk chocolate chips. She rode the subway to a Nespresso store for three boxes of coffee pods, then walked to Bloomingdale’s to pick up a $245 navy blue MZ Wallace backpack.
Ms. Davis works for Jetblack, a personal-shopping company targeted at mothers launched last summer by a surprising newcomer to the field: Walmart Inc. WMT 0.17% A few hundred shoppers in New York City pay $600 a year to order anything by text message except for fresh food. Members were invited by Walmart, or referred by current members, and need to have a doorman to join.
Their orders go to Jetblack headquarters where dozens of agents sit at computers and field requests, from reordering diapers to making suggestions on high-end cribs, organic snacks and yoga attire. Couriers fetch the items and bring them back to a Manhattan delivery hub, where they are wrapped in black packaging and hand delivered, usually the same day.
It’s a labor-intensive operation that loses money. But making money isn’t the goal, at least not right away.
Walmart executives are betting the upstart becomes a powerful weapon in an escalating technological ground war with Amazon.com Inc., as the two companies battle over shoppers who are increasingly making all sorts of purchases online. Amazon reset the landscape with Prime, in which more than 100 million people globally get two-day delivery and other perks for $119 a year. Even though Walmart is bigger in sales overall, it is an underdog online, and it is fighting for a larger presence.
Walmart is using Jetblack’s army of human agents to train an artificial intelligence system that could someday power an automated personal-shopping service, preparing Walmart for a time when the search bar disappears and more shopping is done through voice-activated devices, said Jetblack CEO Jenny Fleiss.
Read more here.
Jeremy Jones, CFA
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