Walmart’s decade-old aspiration to start its own bank just got a boost, with the roll-out of GoBank, a free mobile checking account, in partnership with Green Dot.
The launch of GoBank comes at a pivotal time for Walmart, which has been underperforming in the US, but will a further foray into financial services benefit its core retail operations?
Walmart has long positioned its efforts in financial services as part of its larger commitment to “serving the under-served.” GoBank aligns closely with the traditional Walmart messaging around value, ‘Save Money. Live Better’.
“Adding the GoBank checking account to our shelves means our customers will have exclusive access to one of the most affordable, inclusive and easy-to-use checking accounts in the industry,” said Daniel Eckert, senior vice president of services for Walmart US.
“GoBank gives our customers yet another option as to how they manage their money. When our customers have options, they win.”
The missing line from Eckert’s quotation is “When our customers win, Walmart wins.”
Indeed, GoBank is likely to help Walmart bolster store traffic and supplement its abundance of shopper data. Despite generating flat comps in the Walmart US division in its second quarter - an improvement on five previous quarterly declines - traffic remains a key issue. It was down 1.1% in the second quarter.
Although the GoBank account is described as mobile-first, key touchpoints will take place in store. To set up the account, consumers must purchase the starter kit in store and complete the application process.
After the application is approved, new account-holders are given a temporary debit card, with which they can immediately make purchases. And where do you think those first purchases will be made? Walmart would be a very good guess.
Second, by setting up Walmart cash registers as a point to make GoBank deposits, the retailer again succeeds in getting account-holders into stores. I’m sure Walmart anticipates that a portion of those deposits will end up back in its registers as merchandise purchases.
Likewise, GoBank services, such as early access to the account-holder’s wages, should help bolster sales from shoppers living paycheck to paycheck.
With each and every one of those transactions, Walmart gains access to yet another data point about its shoppers.
Those insights can pave the way for improvements in everything from localised assortments to target marketing.
Kelly Tackett is US research director at Planet Retail