Wal-Mart Stores Inc. (WMT, Financial) is testing a new concept of delivering food and groceries right to your refrigerator by joining forces with August Home, a supplier of smart locks and smart home accessories.Â
The process begins once a customer orders groceries online which need to be delivered within a specified time. For safety measures, the customer needs to have August Home smart lock and security camera. The delivery person, called a Deliv driver, will arrive at the customer’s house and, if no one answers the door, will be able to enter after entering a one-time pass code into the front door’s smart lock. No sooner is the pass code activated than a notification reaches the customer’s smartphone.
Having been notified about the delivery, the customer can check on the Deliv driver’s activities live by monitoring them through home security cameras. The Deliv driver then finds the kitchen and places the items inside the refrigerator. Once the driver exits, the customer receives a notification the door has been locked.
This new concept of direct-to-fridge delivery is being tested using select August Home customers in California’s Silicon Valley. Sloan Eddleston, vice president of e-commerce strategy and business operations, said in a blog post:
"What might seem novel today could be the standard tomorrow. This may not be for everyone – and certainly not right away – but we want to offer customers the opportunity to participate in tests today and help us shape what commerce will look like in the future."
Amazon is leaving no stone unturned
Walmart’s potential new delivery system appears to be a tactical move to counter Amazon.com Inc. (AMZN, Financial).Â While the retailer is busy testing the direct-to-fridge service, AmazonÂ has been expanding its reach inÂ the restaurant industry by partnering with online food delivery app Olo. Olo is the major ordering software supplier for 200 restaurants across 40,000 locations in the U.S. The restaurants it serves include ChipotleÂ (CMG, Financial), Applebee's, Shake ShackÂ (SHAK, Financial) and many more. Now that Amazon has made its mark in the grocery segment by acquiring Whole Foods, it wants to strengthen its restaurant operations.
Both Walmart and Amazon are tirelessly competing and exploring new technology to gain an edge over the other. The idea of direct-to-fridge delivery may only be appealing to those who have limited time or those who dislike grocery shopping. Many consumers may not be prepared for this technology or open to the idea of allowing a stranger into their home while they are away. Only time will tell whether this technology will work for Walmart.
Disclosure: I do not hold any positions in the stocks mentioned in this article.