Data Dive

Data Dive, Trying New Things Edition: Walmart, Amazon And EU Card Fees

Poet William Cowper famously wrote in his 1787 poem “The Task” that “variety is the spice of life.” And while change-resistant humans are often a bit hesitant to live by those words, every once in a while, embracing the unknown is appealing to either individuals or businesses.

And, in fact, it seems to have been one of those weeks in payments and commerce for some very marquee-name players. Walmart, Amazon, Visa and Mastercard all launched new things, proving that variety can also be the spice of payments.

Walmart Makes It Easy to Shop Online While in Store

As part of its ongoing embrace of a more omnichannel shopping experience, Walmart announced last week that it is adding a new in-store app that gives store associates immediate access to Walmart.com to help consumers find, order and pay for digital items while they are standing in the store.

Consumers looking for a specific product they can’t find in-store can now ask an associate to help them find the item online via an in-store device. The feature also gives consumers a wider range of payment options than are normally available for digital consumers. In the press release announcing the new feature, Walmart noted that customers can pay via cash, check, credit card or Walmart Pay.

After choosing shipping or in-store pickup, customers receive a receipt or email that they can take to a cash register within the store to be paid. The shipping process commences as soon as checkout is completed.

The change comes as one of several Walmart has made of late to enhance its holiday shopping offering. Check Out With Me was live at Supercenters nationwide for Black Friday. That feature allows workers to carry mobile devices to help customers check out from a variety of locations within the store. The retailer said at the time that “associates will help customers pay and go by simply swiping their credit card and providing them with a paper or electronic receipt for their purchase.” That technology was originally tested in lawn and garden centers.

Walmart, with its menu of upgrades and changes to the in-store, digital and blended shopping experience, is reportedly expecting big things from the 2018 holiday season. The retailer raised expectations for the full year following the third quarter with stronger-than-expected earnings.

And Walmart isn’t the only retailer upgrading its service.

Amazon Eyes a Bigger Stage for Cashierless Tech

According to reports last week, Amazon is exploring the expansion of its cashierless checkout technology to a larger store format, starting in an experimental Seattle store.

The system being tested tracks what shoppers pick up from store shelves and charges them as they exit a large (grocery store-sized) store format. While the technology is already in commercial use in the smaller store format, the challenges of larger spaces that carry more products and have higher ceilings are a bit more complex. It is not clear if the technology is destined for Whole Foods, though news reports indicate that some Amazon executives believe Whole Foods is the venue best suited for cashierless checkout.

Amazon has declined to comment.

Cashierless tech is currently up and running in seven Amazon Go stores sprinkled throughout Seattle, Chicago and San Francisco. Those stores are about 2,500 square feet and stock a range of drink, snack and grocery items. There are plans to add more locations in urban areas nationwide.

But given that each Whole Foods store carries 34,000 products and has a footprint of 40,000 square feet, adapting the pick-and-go tech will be a challenge. Sources indicate that it could take some time before Amazon can roll out the technology to larger format stores, and that the experimental phase might go on for a while.

If Amazon is able to roll out larger Amazon Go stores, it would be another direct assault on grocery store operators, which have been reeling ever since Amazon acquired Whole Foods in 2017 for $13.5 billion. It will be interesting to see what industry changes Amazon might inspire if it pushes the cashierless experience to a wider range of stores.

And speaking of changing: With a bit of a push, the card networks are also contemplating a change this week, in an attempt to keep EU regulators happy.

Visa and Mastercard’s New Tourist Fee Offer

Both Visa and Mastercard will cut the fees that are paid by merchants on tourists’ card payments within the EU in an effort to end an antitrust investigation in the region.

Both payments companies have proposed a 0.2 percent fee on non-EU in-store debit card transactions and a 0.3 percent fee on in-store credit card transactions, the European Commission said on Tuesday. That change would place those fees into alignment with charges on EU-issued cards.

As has been reported, the European Commission has been tied to what the newswire billed as a “decades-long crackdown … against such fees.”

Online transactions remain at 1.15 percent for debit products and 1.5 percent for credit.

Third parties have a month-long comment period before the EU Commission will make an official decision to accept the proposed fee structure. The Commission could, according to reports, still come back and request an even larger reduction.

What is the lesson this week?

Variety is certainly the spice that keeps the payments news cycle spinning.

See you next week.

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