Walmart Taps American Express Veteran to Run Membership Plan
(Bloomberg) -- Walmart Inc. has hired a veteran of American Express Co. to run Walmart+, the membership program it unveiled less than a year ago to counter Amazon.com Inc.’s Prime plan.
Chris Cracchiolo, a senior executive who spent 19 years at the credit-card company, will take over as senior vice president and general manager of Walmart+ on July 12, Chief Customer Officer Janey Whiteside said in a memo obtained by Bloomberg News. He replaces David Echegoyen, who left last month to join a private equity firm. Cracchiolo will report to Whiteside, a fellow veteran of AmEx.
Walmart debuted the $98-a-year membership program in September but has said very little since then about how the service is performing. Walmart+ offers unlimited free home delivery of groceries and other items, as well as fuel discounts. The program also recently added discounted prescriptions.
Morgan Stanley estimates it has nearly 12 million members, but is growing “at a modest and somewhat inconsistent pace.” Those members, though, spend “far more” at Walmart than other customers, according to Consumer Intelligence Research Partners.
Walmart has declined to share information on membership or sales for Walmart+, leaving analysts to guess about its performance thus far. Chief Executive Officer Doug McMillon played down the service on a call with analysts in May. He said that with so much else going on at the company, the membership program shouldn’t be “the primary focus at the moment.” It’s also unclear if Walmart+ will be linked to the new fintech startup it launched earlier this year.
Amazon’s Prime program, by comparison, is a primary focus for Walmart’s rival. While the Seattle-based company also doesn’t share specifics, CIRP estimates that Prime has 147 million U.S. members and a renewal rate of 98% after the first year, showing that it’s able to hold onto customers after trial subscriptions expire. Prime also includes streaming video, and Amazon is looking to expand its reach in Hollywood by acquiring Metro-Goldwyn-Mayer.
Cracchiolo was previously senior vice president of global rewards and lifestyle benefits for the credit-card company, where he was responsible for AmEx’s Membership Rewards program, according to the memo. Echegoyen, whose background is in marketing, served as chief customer officer of Walmart’s Jet.com unit before taking the Walmart+ role.
“Walmart+ is an important part of our business and I can’t wait to see how Chris and the team find new ways to deliver for our customers,” Whiteside said in the memo.
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