• Juanita Neville-Te Rito

The legacy retailer crushing it IRL



It is a rare day when the retail newswire isn’t filled with updates on Amazon, Alibaba, Apple and the new DTC kids on the block like Allbirds, Lively and Casper. The world finally got over the “retail is dead” conversation to “get” that our new retail norm is simply Total Retail; or omnichannel, or whatever you call serving and connecting with your shopper whenever, wherever and however they choose to interact with you.


I still enjoy the conversation with the (typically) pale, male and stale board member (often ex-account/banker) come-self-appointed-retail-expert-because-my-wife-shops, when they say “but retail stores aren’t going to continue to grow. Physical retail is simply something left to legacy retail networks.” I often start with a wee chuckle on the inside before explaining to them how “well blow me down but you aren’t right on this occasion” retail is transforming to right size and move with our ever connected customer.


Don’t get me wrong, the likes of Amazon have certainly taken the breath out of the retail sector but provided a moment in time for some legacy retailers to get their act together and revolutionise their business to once again reign supreme.


Walmart is a behemoth but it hasn’t been asleep on the job. While the likes of Amazon have been trialling cashier-less concepts, trying to buy their way into grocery (Amazon’s Wholefoods acquisition) and figuring out how to get a physical footprint for their business, Walmart has been making gigantic gains and accelerating to dominate and reign supreme using its 50-year-old set of skills, experience and knowledge.


Let’s start a revolution

Walmart has made a move which is part PR hype and part revolution in the world of bricks and mortar retail. They have blended sophisticated AI and machine learning process into a 50,000 square-foot grocery store in New York. The concept IRL, or Intelligent Retail Lab, is leading the way in retailing through the use of AI to enhance the physical shopping experience.


IRL is located in one of Walmart’s high-traffic market grocery stores ranging approximately 30,000 skus. AI-enabled cameras, sensors, interactive displays and an enormous data centre is at the heart of the technology that analyses everything in the store. And this set-up is on steroids. Can you imagine what it’s like to process 1.6 TB of data per second? The equivalent to downloading three years’ worth of music- 27,000 hours every, single, second. The hardware is connected by enough cabling to scale Mt. Everest five times.



What are they trying to do?

One great opportunity lies in merchandise optimisation with “never an empty shelf.” For example, the IRL technology will immediately identify when a package of meat is picked off the shelf and automatically trigger out-of-stock notifications to an internal app alerting staff of the need for restocking. In addition, this will identify when perishable goods are past suggested best-by or use-by dates. As team members will no longer need to continually check for low or out of stocks, they can spend more of their time engaging and helping customers.





Some opportunities are much larger, long-term machine-learning outcome. AI can create a more seamlessly integrated, demand-driven supply chain vs. the inefficient, forecast-driven model of the past. This means a win for the customer, what they want, where they want it and for Walmart lower costs, increased margins and higher product turnover. Likewise there will be benefits to ensuring checkouts are open, shopping carts available and the ability for customers to provide feedback and interact with information.


Mike Hanrahan, the CEO of IRL said, “Technology enables us to understand so much more – in real time – about our business. When you combine all the information we’re gathering in IRL with Walmart’s 50-plus years of expertise in running stores, you can create really powerful experiences that improve the lives of both our customers and associates. You can’t be overly enamoured with the shiny object element of AI. There are a lot of shiny objects out there that are doing things we think are unrealistic to scale and probably, long-term, not beneficial for the consumer.” Hmm, was he referring to Amazon-Go??



My bet is on the smart resilient retailers like Walmart who are retail practitioners, craftsmen and those with a passion for retail. It’s their gig. They have to learn the digital world, which we are all learning together as it morphs and changes. The new kids on the block need to learn the art of physical retailing and that’s tough requiring experience (and footprint) you cannot simply voila at the click of a button. Let’s face it, no amount of money can buy that experience.


Pure-play driven retail is never optimised without bricks and mortar and hence never backs the big bucks and impact on the grand scale. So my hat goes off to those legacy retailers that are getting with the programme and blowing up the old models, learning, testing, implementing or failing fast, then repeating the process all over again.


#retail #retailx #makingretailhappen #walmart #retailtech #IRL #AI

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