Enterprise

Here's why Walmart is betting on Microsoft's AI to challenge Amazon in online and physical retail

Walmart employees
Walmart plans to use Microsoft's artificial-intelligence technology to improve customer experience in stores and online. Gunnar Rathbun/AP Images for Walmart
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Walmart and Microsoft have shared more details on their plans to team up and take on their mutual rivals at Amazon.

"We want to be the world's most trusted retailer," Fiona Tan, the senior vice president of customer technology and artificial intelligence at Walmart, said at a Microsoft event held this week.

At the event, Tan discussed how a Microsoft-Walmart engineering team would migrate the retailer's internal business applications to the Microsoft Azure cloud. She also announced plans to use Microsoft's AI technology in ways meant to improve online and in-store shopping.

Walmart fiercely competes with Amazon for dominance in the retail sector, while Microsoft Azure is generally seen as the greatest rival to the market-leading Amazon Web Services cloud.

Tan said Walmart considered multiple options for AI technology but chose Azure because of Microsoft's track record in the field of AI.

"They had a good amount of research," Tan said. "We've always had a good strong partnership with Microsoft. They have a lot of good tools. It's a good fit."

Walmart plans to use Microsoft's AI technology to help with product search and recommendations on its recently revamped website. That tech could help Walmart provide more relevant recommendations to its customers on its site and improve customer experience, Tan said. It also wants to use AI to help scale its online grocery program and predict which groceries customers want to order.

With AI, Walmart can also figure out the best models to price an item, especially seasonal items, Tan said. Throughout the year, prices vary by location and availability, but AI can create models that predict these changes.

It's not just about pricing and online shopping though. Walmart plans to use Microsoft tech to improve one of its must futuristic initiatives: a robot that moves up and down the aisles to scan the shelves. The robot can recognize when people misplace items and alert associates to put the items on the right shelf.

With the robot also counting items on the shelves and making sure they're in stock, the human associates can focus on helping customers.

"Our associates can spend more time doing what they like to do, which is to sell products," Tan said. "These are the kinds of things to allow them to have time to interact with our customers."

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Walmart is also looking into voice commerce, which can be used in conjunction with assistants like the Google Home, Tan says. For example, a customer can tell a voice assistant to add milk to a shopping cart. This is in beta.

The robot is already being used in about 50 Walmart stores across the US, and Walmart plans to leverage Microsoft's AI technology to improve these bots.

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Rosalie Chan
Rosalie Chan is a senior editor for Business Insider's tech team. Previously, she covered cloud computing and enterprise tech, reporting on companies like Google Cloud, Amazon Web Services, Microsoft, Intel, Alibaba Cloud, Atlassian, GitHub, VMware, Broadcom, and more. She has written extensively on topics including cloud computing, developer companies, open source, and sexism and sexual harassment in the tech industry. She has received the San Francisco Press Club award for continuing coverage for her reporting on sexism and sexual harassment in Silicon Slopes and the Excellence in Business / Consumer / Tech Reporting award from the Asian American Journalists Association for her investigation into the coding boot camp Holberton School. Most recently, she was an editor on the Business Insider investigative package, The True Cost of Data Centers, which received a George Polk Award and an honorable mention from SABEW.Rosalie joined Business Insider after working as a software engineer and freelance journalist. She studied journalism, computer science, and technology and business law at Northwestern University. Her work has previously appeared in TIME, the Huffington Post, VICE, Pacific Standard, Inverse, Chicago magazine, the Chicago Reporter, and more. She's based in San Francisco.