Wal-Mart sees sales lift from Pay with Cash, search

SAN FRANCISCO Wed Jun 6, 2012 3:42pm EDT

Wal-Mart shareholders Bob and Sharon Frye shop at a Wal-Mart Neighborhood Market store in Bentonville, Arkansas, May 31, 2012. REUTERS/Jacob Slaton

Wal-Mart shareholders Bob and Sharon Frye shop at a Wal-Mart Neighborhood Market store in Bentonville, Arkansas, May 31, 2012.

Credit: Reuters/Jacob Slaton

SAN FRANCISCO (Reuters) - Wal-Mart Stores Inc (WMT.N) is seeing a sales lift from new efforts to get more shoppers buying online while still visiting physical stores, Joel Anderson, chief executive of Walmart.com, the ecommerce arm of the world's largest retailer, said on Wednesday.

Wal-Mart launched Pay with Cash in late April, allowing customers to order on its website and pay at a store within 48 hours.

The program, aimed at getting more Wal-Mart shoppers with limited access to credit online, has had a strong start, Anderson said at the Internet Retailer Conference & Exhibition in Chicago.

Pay with Cash now accounts for almost two percent of all online orders and 30 percent of these customers are new to Walmart.com, Anderson said.

The size of Pay with Cash orders is 50 percent larger than the average online order, according to Wal-Mart.

When Pay with Cash customers come into a Wal-Mart store, about 40 percent of them end up paying with a card or some other form of non-cash payment, Anderson also noted. That suggests a lot of Wal-Mart customers are still concerned about using credit and debit cards online, Anderson said.

Wal-Mart also launched a new search engine on its website earlier this year. Since then, the company has seen a "double digit" increase in conversion - a measure of how many shoppers end up buying something after searching for a product, Anderson said.

Wal-Mart and many other retailers are scrambling to keep up as more consumers shop online at Amazon.com Inc (AMZN.O), eBay Inc (EBAY.O) and other e-commerce destinations.

The increasing popularity of smart phones is hastening the shift online as shoppers check prices and availability of products sold by online rivals while they are in stores.

This trend, known as showrooming, worries a lot of retailers and is a big topic of discussion at this year's Internet Retailer conference.

Anderson said Wal-Mart is tackling this threat by trying out new mobile technology that lets customers use smart phones a lot more in stores.

"It's happening and we're embracing it," he said in an interview with Reuters.

Wal-Mart's online sales are still a small fraction of its total revenue. However, Anderson said mobile transactions are growing a lot and often do not show up in traditional e-commerce data, which typically measure Web activity only.

Even Wal-Mart's most "economically challenged" customers are gaining access to Internet connections now because they are giving up home landlines in favor of cell and smart phones - a trend that is helping increase mobile sales inside and outside of stores, Anderson said.

During a presentation at the Internet Retailer conference, Anderson showed a video highlighting some of the new mobile technology Wal-Mart is using and testing.

One scene showed a customer scanning products with a Wal-Mart app on their smart phone and checking out with the device.

Mobile checkout may help Wal-Mart reduce labor costs and cut shopping times for customers.

Last week, Neil Ashe, president and CEO of global eCommerce at Wal-Mart, told analysts the company will test mobile checkout later this year.

(Editing by Andre Grenon)

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