Wal-Mart offers holiday shoppers free shipping for online purchases
Not content to just lower prices, Wal-Mart Stores Inc. is upping the ante this holiday season by eliminating something that online shoppers dread: shipping costs.
The nation’s largest retailer announced Thursday that it would offer free shipping on about 60,000 holiday items with no minimum purchase or annual fee now through Dec. 20.
Free shipping has been a hot topic among retailers who sell goods on the Internet as research has shown that many customers avoid buying online because they don’t want to pay for delivery costs.
Wal-Mart’s free shipping promotion includes electronics and thousands of video games, toys, home appliances, furniture, jewelry and baby items. Eligible items are shipped free via standard shipping and delivered to customers’ doors three to five business days after the order is processed.
Wal-Mart’s surprise announcement is a move to spur sales during the most important time of the year for retailers; the company is trying to reverse several quarters of sales declines at U.S. stores open at least a year.
It also delivers a big blow to small retail stores that can’t afford to absorb the cost of free shipping, and to other competitors that also don’t offer the service.
Even online giant Amazon.com Inc. requires customers to place a minimum order of $25 to receive free shipping. Under the company’s Amazon Prime program, shoppers pay an annual fee of $79 to get unlimited free two-day shipping with no minimum-order requirement.
Steve Nave, senior vice president and general manager of Walmart.com, said free shipping would help families save money “so they can bring home more for less.” The company said it would not be increasing prices on products to offer the service.
The discounter said the new free shipping offer plus the company’s Site to Store program, which provides customers free shipping to a Wal-Mart store on tens of thousands of online items, would save shoppers about $25 million this holiday season.
Other retailers, too, have concentrated recently on bringing the cost of shipping down for consumers.
Williams-Sonoma Inc. offers a program in which shoppers pay an annual fee of $30 for free standard shipping on most items with no minimum purchase. J.C. Penney Co. is offering free home shipping on orders of $69 or more and L.L.Bean Inc. is giving customers free shipping with no minimum order through Dec. 20.
Shares of Wal-Mart fell 17 cents, or 0.3%, to $54.34.
Bill Dreher, senior retail analyst at Deutsche Bank Securities, said one of Wal-Mart’s strengths is using its vast network of distribution and logistics to provide customers with low everyday prices.
“This Christmas, Wal-Mart will be leveraging that expertise on the Internet,” he said. “The free shipping is just another pounding of the drum to remind customers of their compelling values.”
