How Walmart is trying to reinvent in-store shopping to win Black Friday

We may be shopping more and more online, but the vast majority of purchases are still made in the real world – and no event highlights it better than Black Friday, the annual holiday shopping festival that consumes every Thanksgiving day US retailers. Last year, Black Friday generated sales of nearly $ 8 billion, according to Adobe Analytics. It remains the best time of the year for discounts on expensive electronics such as 4K TVs, video game consoles and laptops, while many new gadget categories, such as Smart speakers and streaming decoders, have seen their prices dropped in the hope of being recovered. as holiday gifts.

Yet with so many online purchases as retailers blur the lines between Black Friday and Cyber ​​Monday, there is a growing need to try to improve the in-store experience. Many retailers, now under fierce competition from Amazon's dominant e-commerce, are now turning to technology to encourage consumers to skip shipping times and purchase an item in-store, or at least order it online first.

The store best positioned to capitalize on the online and offline combination of an event like Black Friday is none other than Walmart, the big-box retailer that has the largest footprint in the US and the largest One of the most sophisticated technology operations in the retail sector. Following its acquisition of Jet.com a little over two years ago, Walmart has invested considerable resources in creating a cohesive online and offline hybrid operation using mobile applications, cloud computing and important applications. logistics and analysis software. Everything is done to be able to sell as many products on as many platforms as possible.

In terms of retailers, this is called an omnichannel experience, and Walmart's future as a viable business giant depends on its ability to serve customers wherever they want to shop, at any time of the day. especially during events like Black Friday. Of course, Amazon, Walmart's main rival in the retail business, is a company firmly focused on new territories that Walmart currently dominates, such as the grocery, pharmacy and convenience store industry.

Amazon only makes about 40% of Walmart's annual sales of more than $ 500 billion. But the willingness and skills of CEO Jeff Bezos to enter new markets affects all retailers, from Walmart to CVS to Kroger, looking for ways to modernize their business, assuming Amazon continues to grow and develop. Walmart, in particular, has partnered with a number of technology companies to improve its distribution network. He has also begun working closely with Microsoft on a major multi-year cloud computing contract with the Microsoft Azure platform to enhance its online backend, as well as many custom software features that make it easier for customers to access the cloud. 'help manage its stores, warehouses and data centers.

Jae Evans, vice president of technical engineering and global operations at Walmart, says an event like Black Friday is a testament to his efforts to improve his mobile, online and in-store infrastructure. "We imitate this environment – we call it resistance tests – to see how customers enter the store, what they will do," Evans said. The edge in an interview. "We do these tests quite often, we perform iteration, optimization and tuning. We do this cyclically because we are really trying to find those bottlenecks. "

Evans says Walmart has a so-called customer trust center in the heart of Silicon Valley, Sunnyvale, California, which works 24 hours a day during events such as Black Friday. (The center is normally busy at all times of the day, but usually with the help of employees abroad.) The ultimate goal is to make sure everything goes smoothly, as the Walmart mobile app or website gets stuck in the middle of the Black Friday race, or its checkout systems in the store break down. If this is the case, says the center, the center is able to sort the situation and determine the best way to solve it, whether it is a network logistics problem or a real bottleneck In store customers can not enter or checkout.

Photo: Walmart

"We have tried to release our third-party applications," says Evans of software tools used by Walmart's engineering and operations divisions. But because of the volume and scale – 4,700 physical stores and a sprawling website – "we need to create our own set of tools," she adds. "It's not just the scale, but the rate of increase we're experiencing in a short time. We must have this level of elasticity. "

All this behind-the-scenes infrastructure is there to support Walmart's increasingly sophisticated store operations, a cornerstone of its ability to compete with Amazon and other existing big-box retailers. Increasingly, consumers are finding out if a certain product is available in store on a retailer's website and getting ready to pick it up in person. Partly because of this practice, Walmart last week announced a 43% increase in online e-commerce sales when it released its quarterly results.

In some cases, consumers find a product on one website and find that it is available at a lower price in-store at another retailer, a process called "Webrooming" ("Webrooming"), which is the most important thing. The opposite of the usual showrooming behavior that nearly 70% of US buyers said they had adopted. , according to Shopify. Black Friday, although many offers are available on the Walmart website and in other retailers' online stores, some are only available in stores.

To give consumers as many ways to shop as possible, Evans said Walmart was trying something new this year: the personal payment, like the one you have in an Apple Store. It is officially called Checkout with Me and was first launched in August as a pilot program for its outdoor lawn and garden sections in approximately 350 locations in the United States. But Evans says the feature has since been extended to all Walmart Supercenter stores in the United States – more than 3,000 locations – and will be at the heart of in-store Black Friday shopping.

Ultimately, this should help reduce the number of lines and bottlenecks by allowing customers with only one or two items to be checked by a partner running special software. on a smartphone, similar to Apple's retail approach, but with a full registry and a self-payment system. systems as alternatives to managing high volume. It's also a cheaper alternative, at least in the meantime, to a more futuristic setup like the Amazon Go without a cashier. (Walmart would be working on its own version of cashless retail technology and Sam's Club, which is owned by Walmart, has announced plans to open a cashless store in Texas where customers can use their mobile app.)

Another strategy, says Evans, is Walmart's object detector, integrated with its main mobile application, which gives you an easy-to-see pin map in which Black Friday products will be physically stored. In addition, Walmart allows customers to return third-party products sold on Walmart.com to a physical store instead of having to manage the online refund process.

All this, Walmart hopes, will enhance his store experience and encourage more customers to leave their homes and make the physical journey tonight when Walmart stores open for Black Friday and the weekend. Evans added that this type of preparation, new features, and infrastructure investments are now part of the company's broader strategy of merging online and offline retail. The success of the company will ultimately depend on its mobile applications and the ability of its network infrastructure to manage Walmart.com and everything from grocery delivery to Walmart Pay mobile payment service.

Grocery delivery in particular – more than half of Walmart's total sales come from groceries – is a particularly exciting learning experience for Walmart. She explains how she manages vacation sales and other forms of high volume shopping. Walmart expanded its grocery delivery service from 1,000 stores to more than 2,000 in a single year, and only because it has invested so much in technology has it been able to do so says Evans. "It's the kind of volume we're talking about," she says. "It's the complexity and the size that really helped us understand customer behavior."