As Amazon Prime Grows, Walmart And EBay Ramp Up Fulfillment Infrastructure

• Friday, 13 May 2016 12:52

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With Amazon increasing the focus on its same-day delivery service Prime Now and continually racking up new Prime members, Walmart and eBay are fighting back with upgrades to their fulfillment strategies.

Walmart is testing a two-day version of its ShippingPass shipping service, which would match Amazon’s Prime’s two-day offering. ShippingPass delivery is normally three days, but the subscription cost is only half ($49) of Amazon’s price ($99). With the lower price point set to be such a huge factor in the ShippingPass offering, the product selection and customer service included with the program will have to remain up to par with Amazon’s if a sufficient number of Prime subscribers would ever think of using a similar service.

Walmart has attempted tochallenge Prime for the past yearwith the deployment of ShippingPass, but as of now, customers have had to put themselves on a waiting list to sign up for the service.

In another example of extending fulfillment services as a competitive differentiator, eBay is expanding its Valet Drop-Off Program to more than 1,600 FedEx Office locations within the coming months. The program, which is designed to make it easier for consumers to sell products without having to ship and price the product on their own, allows people to drop off items at a FedEx Office. From there, they can be shipped through an eBay Valet processing center to be listed, sold and shipped to the buyer.

The program expansion is an attempt to allow the Valet program to eliminate one of eBay's top pain points, an overreliance on mail delivery that can hamper reach across the U.S. As Amazon continues to build out its own distribution centers and spread its logistics network, a growing partnership with FedEx may provide eBay with the assistance necessary to keep up with its fulfillment requirements.

Additionally, the Valet expansion follows the omnichannel model of streamlining new customer onboarding by simplifying the shipping process, enabling users to sell product even if they aren’t comfortable with understanding how to list it on the site.   

The two announcements highlight the ambitious steps major retailers must take in order to stay on par with Amazon’s services. Whereas smaller retailers are disrupting the market with more data-driven employees and numerous omnichannel fulfillment offerings, retailers that are vast in both size and scale don’t always have the agility to make such swift changes. While Walmart’s and eBay’s ability to keep up with Amazon will continue to be an uphill battle, it’s clear that they are aiming to make logistics and shipping a key battleground.