Walmart says Walmart+ fuel perks are driving more loyalty

Walmart executives have said the retailer sees its membership program, Walmart+, as a growth platform to build durable loyalty, and one of its most popular perks has been its 10-cents-per-gallon fuel discount at more than 13,000 gas stations.

With members coming in to save money at the gas pump, Walmart’s plan seems to be working. Members are increasingly relying on the subscription service—which also offers free same-day delivery and free next-day and two-day shipping—for its fuel discounts, driving higher engagement and reinforcing the value of the retailer’s loyalty program beyond standard perks.

During a recent exclusive chat in Bentonville, Arkansas, Deepak Maini, SVP and general manager of Walmart+ membership, told Retail Brew its members are returning more frequently for gas and leaning on Walmart+ for its fuel benefits to cushion the global surge in gasoline prices. While gas prices are starting to come down, the American shopper has had to contend with paying roughly 50% more in the last few months.

“We see them come back and fuel more,” Maini said. “The utilization is improving. It’s growing, especially in this time, so we know that they’re relying on this to save more.”

Walmart+, introduced in September 2020, costs $98 a year, with discounted rates for students and those on government assistance. Walmart CFO John Rainey said during a fiscal Q1 earnings call in May that members are using their fuel savings benefits “even more.”

In Q1, Walmart+ posted a new high in membership-fee revenue as the pace of new member sign-ups accelerated, the company said. Members spend four times more overall than non-members and visit Walmart’s e-commerce site seven times more often, Rainey said.

Zoom out: Total membership revenue, including Sam’s Club and Walmart+, rose more than 17% for the most recent quarter.

Walmart+ is a key part of Walmart’s broader growth strategy, connecting its marketplace, advertising, and data businesses. The more members engage, the more Walmart can offer them better benefits, more options, and more convenience, Maini explained.

“If Walmart+ is useful enough, trusted enough, and relevant enough, choosing Walmart first stops being a decision and becomes more of a habit,” Maini said. “That frequency drives habit, habit drives attention, and retention drives value.”

The way Maini sees it, the biggest advantage for Walmart+ more broadly is delivery. With more than 4,600 Walmart stores, the retailer is closer to customers than any pure-play online retailer can be, he said.

“When members engage with multiple benefits, everything improves,” Maini said. “And that value shows up not just in the membership income that we make, but it shows up in increased frequency of shopping with us. It shows up in increased data capabilities in retail media audiences that we can serve, and it also shows up in increased e-commerce visits and total annual spending.”