Walmart & Microsoft Generative AI for Online Customer Experience

Walmart, a retail giant, has unveiled groundbreaking AI-powered capabilities aimed at enhancing the digital shopping experience for consumers and empowering its associates. By integrating generative AI into its search function, Walmart is personalising the browsing experience for shoppers using a blend of proprietary data, technology, and advanced language models. The company, renowned for its low prices, generated over $82 billion in e-commerce sales in fiscal year 2023 and is keen on further enhancing its active digital customer base.

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At CES 2024, Walmart’s CEO Doug McMillon and Microsoft’s CEO Satya Nadella, unveiled these new AI innovations set to benefit Walmart customers. Leveraging Walmart’s proprietary data and technology, alongside large language models, including Microsoft Azure OpenAI Service, the generative AI search function aims to provide curated lists of personalised items based on individual shopper preferences.

Studies emphasise the transformative impact of AI on businesses, with McKinsey predicting a $400-660 billion value creation in the retail and consumer goods industry. Walmart’s move aligns with the sentiment among online shoppers, as nearly 80% believe AI personalization can enhance their digital experience. Additionally, an IDC study commissioned by Microsoft highlights a significant return on investment, with retail and consumer packaged goods companies seeing $3.45 for every $1 invested in AI.

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The generative AI-powered search function is designed to understand the context of a customer’s query, allowing for more interactive and conversational experiences. For instance, a parent planning a unicorn-themed birthday party can simply ask, “Help me plan a unicorn-themed party for my daughter,” streamlining the search process.

Walmart’s choice of Azure OpenAI Service is driven by the ability to access advanced AI models while benefiting from enterprise-grade capabilities offered by Microsoft Azure, including security, compliance, and regional availability. This move towards generative AI in retail marks a shift from traditional “scroll searching” to more efficient “goal searching,” making the digital shopping experience seamless and intuitive.

Notably, Walmart is not only focusing on enhancing the customer experience but also empowering its associates. The “My Assistant” app, launched for non-store associates, utilises Walmart’s proprietary data and technology in Azure OpenAI Service. This tool has proven impactful, assisting associates with tasks ranging from summarising lengthy documents to content creation.

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The collaboration between Walmart and Microsoft dates back to 2018, signifying a shared commitment to drive digital transformation within Walmart. Microsoft’s role as a preferred cloud provider has facilitated numerous projects, from optimising data management to enabling access to health records at in-store clinics. This ongoing partnership highlights the continuous innovation fostered through AI-driven solutions.

While Walmart adopts a generative AI approach tailored to its needs, Microsoft offers a diverse portfolio of prebuilt, low-code, and pro-code solutions to cater to different scenarios across the retail landscape. This collaborative effort signifies a commitment to innovation and sets the stage for continued advancements in the intersection of retail and artificial intelligence.

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