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06/24/2021

Walmart Explains How Its AI Tech Substitutes Products

Retailer’s solution pre-emptively asks customer to approve alternative item
Bridget Goldschmidt
Managing Editor
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Walmart Explains How Its AI Tech Substitutes Products
Srini Venkatesan

Amid the pandemic, a huge uptick in online shopping led Walmart to deploy artificial intelligence to help both customers and the company’s Personal Shoppers choose the best substitute for an out-of-stock item. In a recent blog post, Srini Venkatesan, EVP, Walmart Global Tech, explained how this technology works. 

“The decision on how to substitute is complex and highly personal to each customer,” wrote Venkatesan. “If the wrong choice is made, it can negatively impact customer satisfaction and increase costs. In the past, our Personal Shoppers would go through a manual process to determine the best way to manage a substitution. But there are nearly 100 different factors that can go into that decision. Trying to account for all of these would not only be too difficult, but it would also be incredibly time-consuming.”

To streamline the product substitution process, Walmart’s team came up with a technology solution to help identify the next best item for shoppers if an item they want isn’t available.

“The tech we built uses deep-learning AI to consider hundreds of variables size, type, brand, price, aggregate shopper data, individual customer preference, current inventory and more – in real time to determine the best next available item,” noted Venkatesan. “It then pre-emptively asks the customer to approve the substituted item or let us know they don’t want it, an important signal that’s fed back into our learning algorithms to improve the accuracy of future recommendations.”

He added: “The solution is also designed to make our associates’ jobs easier. Instead of having to guess, the Personal Shopper can be told precisely what the customer may prefer. If our Personal Shoppers are preparing orders and come across an item that is not available, our system suggests the alternative product. Our tech even shows our Personal Shopper where the item is located in the store, simplifying the decision-making process for our team and enabling them to prepare orders quickly and efficiently.”

According to Venkatesan, the company is continuing to improve this technology, and has been received positively by shoppers. “The best part is, throughout the entire process, the system is learning and getting smarter based on customer input and actions,” he pointed out.

Bentonville, Ark.-based Walmart operates more than 11,300 stores under 48 banners in 24 countries, and e-commerce websites, employing 2.2 million-plus associates worldwide. Walmart U.S. is No. 1 on The PG 100, Progressive Grocer’s 2021 list of the top food and consumables retailers in North America, while Walmart-owned Sam’s Club ranks No. 9 on the list.

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