Walmart's newest Instacart partnership bolsters the retailer's same-day delivery offerings – and takes dead aim at Amazon's Whole Foods

Brendan McDermid/ReutersWalmart’s new Instacart-fuelled service has yet to roll out across the United States.
  • Walmart and Instacart will reportedly now offer same-day delivery options across four markets in California and Oklahoma.
  • In 2019, Walmart and Instacart expanded the retail giant’s delivery presence in Canada.
  • Moody’s retail analyst Charlie O’Shea said in a statement that this new collaboration is Walmart’s latest “salvo in its delivery arms race with Amazon.”
  • Visit Business Insider’s homepage for more stories.

Walmart is partnering with Instacart to provide same-day delivery services in a handful of US markets, in efforts to take on chief rival Amazon’s Whole Foods business.

California consumers in Los Angeles, San Francisco and San Diego can now test out the pilot program – along with shoppers in Tulsa, Oklahoma, according to a Tuesday report from CNBC.

Walmart did not immediately respond to Business Insider’s request for comment. An Instacart spokesperson confirmed the partnership to Business Insider, saying that shoppers in the four select markets “can shop from all of their favourite Walmart aisles online, and an Instacart personal shopper will pickup and deliver the orders.”

“The new partnership brings thousands of items – from groceries, alcohol, and pantry staples to home decor and improvement, personal care, electronics, and more- at everyday low prices from Walmart stores to customers’ doors in as fast as an hour,” the spokesperson told Business Insider in a statement.

This is not the first time that Walmart and Instacart have teamed up. In August 2019, the companies announced plans to bring on-demand grocery delivery services from nearly 200 Walmart stores across Canada on Walmart’s website.

Walmart’s partnership with Instacart, in Canada, allowed shoppers to “choose a delivery window” – between an hour and five days – for their product delivery. An Instacart shopper would then fulfil the consumer’s request based on the selected time frame.

Walmart’s latest move with Instacart also comes as the retail giant appears intent on challenging Amazon’s fulfillment capabilities. Amazon is currently rumoured to be interested in turning abandoned mall department stores into additional fulfillment centres. Meanwhile, Walmart is looking into launching a subscription service to further compete with its e-commerce rival’s Prime offering.

Moody’s retail analyst Charlie O’Shea said in an emailed statement that this new Instacart collaboration represents Walmart’s latest “salvo in its delivery arms race with Amazon.”

“Walmart will continue to leverage its 5,300-plus physical locations in the US, which is a compelling competitive advantage as it provides consumers with a same-day pick-up option, with same-day delivery augmenting this capability, creating a very powerful one-two punch,” he said.

As for Instacart, the partnership comes at a time when coronavirus-conscious consumers are particularly eager for delivery options that help mitigate their own exposure to the virus. O’Shea said in a statement that “the pandemic has accelerated the growth of grocery delivery by years.”

Instacart already partners with major retailers like Target, Costco, and Walmart’s Sam’s Club. Whole Foods, once also an Instacart partner, was acquired by Amazon in 2018.

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