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Thursday, August 3, 2017

Walmart Canada says it is cancelling the $2.97 pickup fee charged to customers when they order groceries online and pick them up in stores.

While the fee was modest, the company's internal studies indicated it was a barrier preventing some people from using their online grocery pickup service, Daryl Porter, vice-president of online grocery for Walmart Canada, told Canadian Press.

"Even though it's a small dollar amount, it means something," Porter said. "We want to remove that fee and give people a better chance to try it."

Walmart Canada wouldn't disclose how much it stands to lose by scrapping the fee and how many customers use its online grocery pickup service.

The service launched in Ottawa in July 2015, about a year after Loblaw rolled out a similar program in the Toronto area. Walmart Canada has since expanded the service to the Greater Toronto Area, Calgary and Edmonton, and Porter said there are plans to bring it to a fifth market that will be unveiled in about a month.

Michael von Massow, an associate professor in food economics at the University of Guelph, said Canadians lag behind Americans when it comes to using online grocery pickup services, though they are catching up and it is a market with potential to grow.

He said key for retailers including Walmart is locking in first-time consumers because research shows they are unlikely to switch once they become accustomed to ordering online. "If you can get their first order, you're more likely to get their second order," he said.

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