Walmart: Amazon image recognition a 'shiny object'
The world's biggest real world retailer plans to catch up with its online competitor using mobile apps that focus on an in-store experience rather than a piece of fancy technology.
Walmart says it doesn't need flashy tech like Amazon's augmented-reality search to make its customers happy -- it's got a mobile app that's digitally hooked to 4,000 physical stores scattered across America.
"We need to make sure we're not just going after the shiny object," Walmart Vice President of Mobile and Digital Wendy Bergh said when asked on Thursday about Amazon's recently added image-recognition search feature. The feature, which Amazon added to its main shopping app, lets users search for products by taking a photo of the item. It's a pretty neat piece of tech, and Amazon hopes it will encourage its customers to buy more everyday household items.
While Walmart makes more money selling things offline, it has to catch up with Amazon's online revenues. And, as with everyone else trying to sell things online, mobile is an important market for Walmart. More than 50 percent of Walmart's customers own smartphones, according to the company's research. The number of customers who go to Walmart.com through a mobile device has tripled over the last year.
Bergh, who didn't write off augmented-reality tech completely, wouldn't say if it was a feature Walmart would ever roll out.
"We need to make sure we are addressing the friction point, or making it easier for the customer, if we can actually make a meaningful impact to their experience. It's not something we're going to do just to do it," she said in an interview with CNET at AppsWorld in San Francisco, where Bergh gave a presentation on mobile-shopping strategy.
Instead, Walmart's approach is to use its strengths. Namely, developing features on its mobile app that use Walmart's advantage over Amazon: physical locations. Given that 140 million people visit a Walmart store each week, Walmart has some leverage here.
"We're bridging mobile offline and online," Bergh said. The company started testing its in-store mode, which uses geo-fencing to detect when a customer is in a physical store, more than a year ago. When the mode is activated, customers can check their wish lists, search for a product within the store, and see local promotions. The app also includes a "Scan & Go" feature that lets customers scan items as they shop so they can move quickly through self-checkout.
Bergh said Walmart is still collecting feedback so she couldn't share how often customers use the features, but the company has found that customers who use the app to shop at Walmart buy things twice as often as customers who don't, and they spend 40 percent more.
"They are more engaged and tend to be more loyal customers," she said.
The most recent Thanksgiving holiday -- when more than 55 percent of all its Walmart.com traffic came from mobile devices -- illustrated how Walmart benefits from a strong dual presence, according to Bergh.
Shoppers headed to Walmart stores during Black Friday to buy big screen TVs, and while they were standing in line to pay for their TVs, they used their smartphones to visit Walmart.com and shop for TV wall mounts.
They only wanted to grab the big-ticket items during the holiday sale, so they could get in and out of the hectic stores quickly, saving the lower-priced items for an online purchase, Bergh said. Plus, the wall-mount selection online was much larger than what a local store could offer.
Unfortunately for Walmart, a case like that has happened only during a big sale day like Black Friday, but you can be sure the company is trying to find more ways to make it easier for people to shop at its physical locations. After all, that's something Amazon doesn't have.