After six months in development, Walmart has publicly launched its new eCommerce subscription brand, Goodies.co. For $7 a month, subscribers are mailed a box of samples of new foods, such as gourmet crackers, that Walmart is considering or has just started carrying on its real-world shelves. The retailer is rolling out the launch carefully, currently by invitation only on the Goodies.co homepage, so they can ramp up fulfillment operations with fewer snags. They claim to have about 3,000 subscribers currently, but no word on how many of these are Walmart employees serving as system testers. (We suspect it’s at least 30%.)Subscription business models for food products are as old as the hills. More than a half dozen companies, ranging from Harry & David to Golden State Fruit, offer fruit of the month clubs, sold online. In the past, though, these were mainly marketed as gift purchases.However, over the last 24 months in particular, we’ve noticed a sharp upward tick in the growth of a new model — eCommerce subscription offerings for consumers who want to avoid the hassle of brick-and-mortar, personal shopping. It’s not about gifting, it’s about convenience. Sean Percival, CEO & Co-Founder at Wittlebee, a $39.99 per month kids clothing club, noted recently it takes about 100,000 paying subscribers for this business model to be profitable.Even though Walmart is currently getting all the samples for its Goodies boxes for free from vendors hoping to grow their sales, the $7 pricepoint is so low that we suspect the most this service can hope for is to do a little better than break even. The bottom line benefit comes primarily instead from market research. Subscribers are bribed with rewards points to give feedback on each month’s samples. This is something greeting cards companies pioneered online years ago. Walmart can also analyze, to some degree, each sample’s impact on real-world store sales, which is something consumer packaged goods firms have been doing with their sampling programs for decades.So, nothing’s new under the sun. That said, Walmart’s sheer size and Wall Street presence means that this launch may mean the financial community will start taking what they consider the “unproven” subscription business model more seriously.
Walmart Rolls Out $7 Monthly Food Subscription Service by Invite Only
After six months in development, Walmart has publicly launched its new eCommerce subscription brand, Goodies.co. For $7 a month, subscribers are mailed a box