As its Jet.com acquisition continues to pay out, Walmart is seeing hyper growth in ecommerce, with U.S. online sales up 63% in the first quarter. On the physical side of things, Walmart’s store traffic and same-store sales were both up in an extremely challenging retail environment, rising 1.5% and 1.4% respectively.
The company said the majority of the online growth was organic through Walmart.com.
“Greg Foran, Marc Lore and the team continue to partner closely to serve our customers and figure out how to invent a seamless shopping experience for our customers across our apps, sites and stores,” said Walmart Stores President and CEO Doug McMillon in an earnings call. “They are plowing new territory and I’m excited about what’s to come.”
Walmart.com launched two new initiatives in the quarter, including a change to shipping terms at the beginning of the quarter that included spiking its two-year-old ShippingPass subscription program.
“Customers don’t have to pay a membership fee to get two-day shipping on millions of items,” said McMillon. “Second we recently began offering customers pickup discounts on non-store items. Our stores are located within 10 miles of nearly 90% of the U.S. population so this is convenient for many of our customers and also saves them money.”
McMillon said Walmart.com now has 50 million first- and third-party items to choose from, a fivefold increase from 10 million in 2016.. The other initiative Walmart made were ecommerce acquisitions of Modcloth and Bonobos to further improve its assortment, while gaining critical category expertise in higher-margin categories like shoes and apparel.
“The acquisitions have received a lot of attention, but our plan in ecommerce is not to buy our way to success,” said McMillon. “The majority of our growth is and will be organic. The acquisitions are helping us speed some things up. So overall we’re making progress in providing the seamless shopping experience our customers desire and we will keep moving along this journey.”
Walmart’s overall net sales were $75.4 billion in Q1 2018, a 2.9% increase over Q1 2017 which was $73.2 billion.