Walmart (NYSE:WMT) sells an impressive array of goods, from groceries to sporting goods, clothing to fishing gear, and pretty much everything in between. The chain also offers a number of store-within-a-store concepts where partners offer everything from fast food to music lessons and eye exams.
Now, the retail giant plans to expand a pilot program it began about two years ago with CarSaver, a service that connects car buyers to dealers, financing, and insurance. The program, which began in one market, now will be rolled out nationally to a total of 250 Walmart locations, and on Walmart.com.
"We're constantly looking for innovative services that help us save busy families money and time," Walmart Senior Vice President Daniel Eckert said in a statement reported by Adweek. "CarSaver's unique platform helps our customers understand the true cost of ownership, while also helping them save money with buying, financing, leasing and insuring a new or used vehicle."
How does it work?
CarSaver partners with a network of local dealers as well as with banks and insurance companies. Customers can look for new or used cars via the company's website or by talking to an "auto advisor" who helps navigate the process.
Once the customer finds the vehicle of their choice, they are connected with what CarSaver calls an "Express Manager" that arranges for a test-drive or pickup at a local dealer. Arranging financing and insurance are options as well and all pricing is upfront with no haggling.
CarSaver will also help with trade-ins as its network of dealers places bids on vehicles customers wish to sell. In addition, the car-selling middleman offers a "lifetime warranty" on most vehicles it sells which "provides coverage to the engine, transmission, and drive axle components for as long as you own the vehicle," according to the company's website.
Why is Walmart doing this?
Walmart wants to be as close to a one-stop-shop for customers as it can be. Some of its services are designed to draw customers into its stores so they may shop in addition. For example, if you have to pick up a prescription at the pharmacy or have an appointment with an in-store eye doctor.
In other cases, Walmart's stores-within-a-store entice customers to spend more or stay longer. The presence of a Subway or other eatery fits that bill.
CarSaver mostly fits the first model since a Walmart customer is not likely to buy a car on the same type of whim that leads to purchasing a pretzel or another snack. It's likely that shoppers will see the car-selling service and consider making a special visit when it's time to buy a vehicle.
That leads to added foot traffic for the chain along with whatever deal it has to rent space to CarSaver. Essentially, this is Walmart lending its brand credibility to a largely unknown service. That allows consumers to feel safer turning over personal information to CarSaver, allowing the company to build a user base.
Will this work?
CarSaver takes some of the pain points out of buying a car. Consumers should like that and having a visible presence at Walmart should jump start the car-sales company's efforts. Of course, you don't need to sell very many cars in a week -- certainly nowhere near as many sandwiches or pretzels -- in order for this relationship to succeed.
Walmart has a customer base and it can leverage that to help CarSaver to establish its own credibility. This should be a win for both companies with there being little risk for the retailer which is really only sacrificing space, something it has plenty to spare.