Google Cloud and Walmart are rolling out new generative AI-based tools that will let retailers improve the experience the online shopping experience of customers.
Google Cloud’s offerings, unveiled Thursday in the run-up to next week’s huge NFR ’24 conference in New York City, aim to not only help personalize online shopping, but also modernize retailers’ operations, and enhance the technologies rolled out in brick-and-motor stores.
Meanwhile, at CES this week in Las Vegas, Walmart showed off different ways the retail giant is using AI to enhance online shopping capabilities and in-store technology rollouts. The company also detailed plans to expand a program launched last year in the United States and Canada that gives on-site associates a generative AI tool to streamline their tasks.
The two announcements were the latest to highlight the rapid adoption by a global retail market that according to market research firm Statista generated sales of more than $27 trillion in 2022 and is expected to increase that to more than $30 trillion this year.
Retail a Prime Sector for AI
A survey conducted by GPU maker Nvidia and released this week found that 98% of retailers plan to invest in generative AI technology sometime in the next 18 months.
“That makes retail making retail one of the industries racing fastest to adopt generative AI to ramp up productivity, transform customer experiences and improve efficiency,” Azita Martin, vice president and general manager of AI for retails, consumer packaged goods (CPG), and quick service restaurants (QSR) for Nvidia, wrote in a blog post.
Given the numbers in the survey, it’s not surprising. According to the survey of more than 400 retail professionals, 69% of those already using AI reported revenue increasing while 72% saw costs shrink. When questioned specifically about generative AI, respondents pointed the promise of improving the customer experience (86%), marketing and content generation (68%), and enhancing the employee experience.
While almost all said they plan to invest in generative AI in the coming months, most are being careful as they move forward, with 77% saying they plan to invest less than $5 million. That cautious approach also shows up when respondents were asked about how their companies envision using the technology. About 46% said it will give them a competitive advantage, but 39% said they were “waiting and watching.”
‘On the Cusp of a Transformation’
“The retail industry is on the cusp of a transformation driven by artificial intelligence,” the report’s authors wrote. “With the highest potential for AI and analytics among all industries, the retail and consumer packaged goods sectors are poised to harness the power of AI to enhance operational efficiency, elevate customer experiences, and drive growth.”
Nvidia’s survey echoes what other organizations are finding. In a report last year, McKinsey and Co. said AI will create as much as $660 billion in value for the retail and consumer goods industry. Other reports noted by Microsoft include one from FTI Consulting that found almost 80% of online shoppers say AI personalization can improve their online experience, while IDC found in a Microsoft-commission study that for every dollar a retail and consumer packaged goods company in AI, it gets $3.45 in return.
More examples of retailers adopting AI will no doubt come out of NRF ’24 and Google Cloud is getting out ahead of the curve.
Google Cloud AI Retail Pitch
Google Cloud unveiled a conversational commerce offering that makes it easier for retailers to embed generative AI-powered virtual agents on websites and mobile apps that can interact with buyers using natural language and give them shopping options based on their needs. The company also is giving its Vertex AI Search for Retail a new large-language model (LLM) that lets retailers give customers a Google-like search, browse, and recommendations embedded on their digital storefronts.
They can customize the LLM to their product catalog and shopper search patterns to improve the search results. A generative AI-based solution for modernizing customer service integrates the retailer’s customer relationship management (CRM) system to deploy AI-based agents that can deliver personalized product recommendations, schedule appointments, or check the status of orders. It also can use AI for language translation
Other AI tools will make it easier and faster for retailers to improve their catalogs
Walmart Using AI for Online and In Stores
For its part, Walmart is expanding its generative AI-powered online search to iOS device users with the latest version the Walmart app. It already was available on the Walmart web site and for Android users and uses a combination of Walmart’s proprietary data, retail-specific models as well as technologies and large-language models from Microsoft’s Azure OpenAI Service.
It offers customers a more interactive experience when using search, according to Shelley Bransten, corporate vice president for global retail, consumer goods, and gaming industries for Microsoft.
“For example, a parent planning a birthday party for a child that loves unicorns,” Bransten wrote in a blog post. “Instead of multiple searches for unicorn-themed balloons, napkins, streamers, etc., the parent can simply ask the question ‘Help me plan a unicorn-themed party for my daughter.’”
Microsoft has been working with Walmart on its ongoing digital transformation efforts.
Last year, Walmart launched My Assistant, an in-house-built generative AI tool to help non-store employees with such tasks as quickly summarizing large documents and creating new content. Initially used in the United States and Canada, the retailer this year will expand its use to 11 countries.
In addition, at 10 Sam’s Club locations, Walmart is piloting an app that uses AI and computer vision technology to reduce the queuing that happens at the stores’ exits when verifying that customers have paid for everything that’s in their bags and carts.
The app uses computer vision and digital technology in the exit area – with AI running in the background to speed the process – to confirm payments of all the items in shoppers’ baskets. Benefits already are being seen at the pilot sites and Walmart will continue to improve the technology through the first part of the year before expanding its use to almost 600 Sam’s Club stores by the end of 2024.