Walmart and Google partner to challenge Amazon's Alexa
Walmart has partnered with Google to bring voice shopping to Walmart customers, using Google's voice-assistant technology on both Google Home and the Google Express website and app, according to blog posts from both companies. Shoppers can also choose to link their Walmart account to Google for "personalized shopping results," according to Sridhar Ramaswamy, Google's senior vice president of ads and commerce, who announced the tie-up in a blog post Wednesday.
Walmart is also incorporating its new Easy Reorder feature into Google Express — and the voice-assisted options will be available starting in late September, Marc Lore, president and CEO of Walmart's U.S. e-commerce, said in a blog post Wednesday.
Starting Wednesday, customers of any retailer will enjoy free delivery on Google Express as long as their order is above each store’s minimum, Ramaswamy said. "There’s no membership required so no matter how you shop — through voice with your Google Assistant or on the website or mobile app — you’ll get free delivery within one to three days," he said on Google’s blog.
Walmart continues its defense against Amazon by taking on Alexa, which so far is edging out Google when it comes to market share in the voice assistant space. Amazon devices like the Echo and Dot speakers, along with apps in mobile devices, could provide some $10 billion in revenue by 2020 and be a "mega-hit," according to a note published this spring by investment bank RBC Capital Markets, though Google has been working hard to add features that Alexa doesn't have.
The tie-up still doesn't approach Amazon's reach, which goes well beyond Alexa, according to Zhewei Zhang, an assistant professor of information systems who researches digital innovation at Warwick Business School. "I don’t see Walmart as a rival to Amazon," he said in a statement to Retail Dive. "Amazon is not just a retailer selling things online but also a platform provider which tries to connect people to the online world. Alexa represents a much bigger ambition than just another way of doing online shopping."
Still, the effort is part of Walmart’s newly assertive omnichannel push, based squarely on providing customers with "always low prices" and convenience to save people both time and money, executives have emphasized in recent months, and Lore emphasized that once again on Wednesday. "Running around, going to work, picking kids up from school, making dinner and, between all of that, there’s shopping to do," he wrote. "Because of this, I believe our job at Walmart isn't only about saving our customers money, but also about making shopping faster and easier."
Gordon Haskett analyst Chuck Grom sees the Walmart-Google play in light of those efforts, noting that Amazon's Alexa is closed off to other retailers and calling it an "intelligent and natural joint venture for both Walmart and Google."
"From Walmart’s vantage point, the relationship appears to be a 'win/win' and builds upon many of its recent digital ecosystem initiatives," he wrote in a note emailed to Retail Dive. "[O]ne of the more interesting aspects from our seats is that starting in 2018, consumers will be able to place orders for in-store pick-up, including fresh grocery items, giving Walmart another avenue to drive shoppers into stores to augment traffic. All told, we like the move and see it as another forward-thinking strategic decision from the team in Bentonville."
The brick-and-mortar giant has moved the needle on e-commerce significantly since its purchase of Jet. Along with a series of e-commerce acquisitions that helped boost sales by 60% in its most recent quarter, the company is increasingly blurring the lines between the in-store and online experience through initiatives including "Next Gen" layouts, in-store pickup kiosks for online orders, discounts on those orders not available to in-store customers and scan and go checkouts. Its Easy Reorder, which launched this summer, is reminiscent of convenience moves by other big players, including Amazon’s Dash buttons and Prime Pantry service and Target’s Restock pilot.
While both Lore and Ramaswamy focused on this particular partnership, Ramaswamy took care to note that, as Grom says, Google is essentially agnostic when it comes to where people shop. "Wouldn’t it be nice if you could get what you want, however you want, from the stores where you already shop?" he said. "We launched Google Express and shopping on the Google Assistant to do just that: make it faster and easier for you to shop your stores like Costco, Target and now Walmart."
That's a bit of a sticking point for both companies. Although the added features help foster some loyalty, Walmart must contend with competitors that are also accessed through Google Home. And Google presumably doesn't want to alienate anyone who prefers to shop elsewhere. Still, Zhang sees the collaboration as more of a win for Google, especially for its positioning into the future, when Amazon may not even be much of a retailer at all.
"This partnership probably will help Google more than Walmart as Google Home, Alexa, Siri, and Cortana are competing to be our personal AI assistant," he said. "I will not be surprised if one day Amazon sells its retail business like IBM did with its PC business."
The reality is that voice-enabled tasks, including shopping, aren't all that easy to accomplish with any of these players, but that will soon change as they evolve, he said. "Voice shopping may not look very useful right now. Indeed, purchase experience through Alexa is quite mixed as many people find it hard to use and do not see the point," he said. "However, I do believe it is the future of online shopping."
And that will stoke competition, according to Maya Mikhailov, co-founder and CMO of GPShopper.
"You’re definitely going to be seeing jockeying for position. What you’re seeing right now [is] the big players to some extent opening up their systems, and that third-party will simply lead to more adoption," she told Retail Dive about the voice market in general. "When you have a closed ecosystem — that not everyone can play on — that inevitably leads to less adoption unless that party already has tremendous momentum. I think there’s a reason you see so much excitement around the connected home. For retailers it has to be a very interesting place to play in because as a retailer you have to be everywhere."
- Sridhar Ramaswamy, Google Senior Vice President of Ads and Commerce Shop Walmart and more of your favorite stores, faster
- Marc Lore, President and CEO, Walmart U.S. eCommerce Walmart, Google Partner to Make Shopping Even Easier – Here’s How
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