walmart (WMT) – Get a free report has spent the last few years locked in an existential war with e-retailer Amazon (AMZN) – Get a free report.
Part of the arms race in that war has been a giant ramp up in technology and delivery capacity, as Walmart has successfully transitioned from just a big retailer to a formidable online presence.
And now, with inflation hitting consumers’ grocery budgets as they change their spending habits, Walmart has found a new way to monetize all the technology investments it’s made over the past decade.
And it’s partnering with cloud-based data software giant Salesforce. (CRM) – Get a free report to do it
“Through this partnership, retailers can take advantage of the same innovative and scalable technologies that power Walmart’s pickup and delivery experiences,” said Anshu Bhardwaj, senior vice president of technology strategy and marketing, Walmart Global Technology.
The net result of the association?
Retailers that Walmart often outcompetes thanks to its scale and technological advantage will now have access to at least the company’s technology.
This could mean mom-and-pop stores that have the same delivery capabilities that Walmart enjoys, giving consumers another option with just as much convenience.
“The same technology that powers Store Assist has enabled Walmart to meet more than 830 million* orders at more than 4,700 Walmart stores. Together with Salesforce, retailers can scale their business and deliver the convenient, personalized experiences shoppers expect,” the company said in a statement.
Do customers bite?
Speaking of Amazon, the retail giant has done something similar by offering smaller rivals the chance to access its technology. But those efforts have seen mixed results.
In early 2020, Amazon began selling its cashierless payment technology, dubbed Just Walk Out, to potential rival retailers.
Amazon is the king of e-retailing in the US, with an estimated 40% market share, according to electronic marketerbut traditional retail still accounts for about 85% of the industry.
Then, in June 2022, the company announced it would make its Store Analytics service available for sale, which allows brands to use an Amazon-like dashboard that shows detailed, but anonymous, data about how their products were discovered.
amazon has been accused of unfairly using partner data to promote its own businesses, but the company insists that its Store Analytics data be aggregated and anonymized.
So while Walmart doesn’t have the data-gathering ability or track record that Amazon does, the question is whether smaller competitors will trust the giant conglomerate with their customer data enough to make the “up-sell” game viable. retail as a service” from Walmart.
Retail as a Service Revenue Stream
Traditional retailers have long struggled with the reality of bottlenecks in the POS lanes and advertising that cannot harness the power of data to target.
Early on, companies like Amazon and Walmart built their capabilities to alleviate those issues and gain an edge over their competitors.
But now they are sharing their progress in an effort to create a new revenue stream, based on retail as a service.
RaaS is “the engine that puts critical transaction processing services, including complex store processing, in the cloud for retailers to use to create the commerce experiences they need,” according to Retail Information Systems.
Walmart sees an opportunity and the company, as it tries to catch up once again with Amazon’s similar offering, is choosing now as the time to strike.
“Shoppers continue to expect brands to deliver frictionless, highly connected experiences across physical and digital touchpoints,” said Rob Garf, vice president and general manager of retail at Salesforce.
“With the combined power of Walmart and Salesforce, retailers can drive success with best-in-class technology to enhance their omnichannel capabilities, drive efficiencies, and ensure that every purchase gets into the hands of the shopper quickly, no matter where they are. ”.
