Wal-Mart Wooing Online Shoppers

Online shopping is a left-brained activity that expects quick and concise search results and perhaps no one understands that better than San Bruno, Calif.-based @WalmartLabs.

Late last week, Walmart.com announced it was using a new “smarter” search engine, dubbed “Polaris” to help shoppers browse, discover and purchase items in an easy, fast and intuitive manner.

“Search is a crown jewel for any e-commerce company to own,” said Neil Ashe, president and CEO of Walmart Global eCommerce.

He said Polaris underscores the company’s commitment to owning technology that is fundamental in giving millions of customers anytime, anywhere access to the products they want at the lowest prices.

Polaris was engineered in house by @WalmartLabs Ashe and crew who say the search engine has already boosted sales among 10% to 15% of the e-commerce shoppers who have used it. Using semantic search technology Polaris anticipates the intent of a shopper to deliver relevant results for them as they browse online.

The @WalmartLabs team spent 10 months working on the new search engine and gradually migrated Walmart.com to the Polaris engine, which is now used exclusively for domestic online and mobile searches. The retailer said it will expand Polaris to its international e-commerce sites in the coming months.

“With Polaris, we are giving users the ability to connect with the items they want but also surface items based on their interests and likely intent,” said Sri Subramaniam, vice president for @WalmartLabs and head of the Polaris initiative. “This is the start of what we imagine search to be as we continue to deliver products to accelerate Walmart’s global e-commerce efforts.”

The company says Polaris uses advanced algorithms including query understanding and synonym mining to glean user intent in delivering results. For example when a user types in the word “denim,” it returns results on jeans or “chlorine tablets,” returns results related to pool equipment.

Ashe says the team continues to evolve Polaris and other advances will be rolled into Walmart.com.

Analysts and retail experts like Carol Spieckerman, CEO of New Market Builders, applaud the strides being made @WalmartLabs to engage shoppers into multiple channels.

In a May 31 blog, Spieckerman notes that while e-commerce is still in its infancy as a volume-driving “channel,” companies like Wal-Mart are establishing digital flagships – @WalmartLabs – often in lieu of physical ones.

She notes the “bricks-to-clicks” model of the past is being turned on its head and a new wave of retail competition is transforming the landscape without laying brick and mortar.

For instance, Spieckerman said Manhattan is a top market for Wal-Mart and the closest brick and mortar store involves a “tedious trek off the island to Secaucus, NJ.” She says “that’s the magic of endless online aisles” as Wal-Mart seeks achievement of a multi-channel milestone.

Polaris is the latest innovation from @WalmartLabs who’s been busy this past year with four other digital promotions:

• Shopycat, a social gift finder;
• Classrooms by Walmart, a program to make back-to-school shopping easier;
• Get on the Shelf, a crowdsourcing contest to unearth new products for Walmart; and,
• Social Media Analytics, tools that use social chatter to select items to be carried by Walmart.

IGD analyst Stewart Samuel also favors the retail giant’s recent digital outlays. He says the retailer continues to provide added convenience for its shoppers, leveraging its multi-channel capabilities with the help of innovative and entrepreneurial contributions from @WalmartLabs.

The next frontier for the Bentonville behemoth is capturing market share from the growing audience of savvy shoppers armed with mobile devices.

A recent report from Nielsen indicates Wal-Mart is still behind when it comes to the mobile shopping audience. The retailer did not make the top 10 list for the most used mobile shopping applications, unlike brick and mortar competitors Walgreens and Target and virtual retailers eBay and Amazon.

The report indicates nearly half of American smartphone owners (47%) used shopping apps in June. Overall, 45 million smartphone owners used apps in the Shopping/Commerce category, accessing shopping apps 17 times on average during June 2012.

The eBay and Amazon apps topped the list, attracting 13 million and 12 million unique users, respectively. Likewise, traditional retailers like Target and Walgreens received significant mobile traffic from savvy shoppers looking to find the best deals in their local retail stores.

“Retailers are finding that consumers are willing to use smartphone apps to enhance their shopping experience, and this data shows usage of shopping apps is growing,” said Don Kellogg, director of Telecom Insights at Nielsen.

He said, “As more Americans use their smartphones while shopping and making purchases directly through apps, retailers should consider personalizing their targeted offerings around the needs of individual consumers.”

Wal-Mart is testing one new mobile application — Scan and Go — with its employees at store No. 5260 in Rogers. Wal-Mart executives said in June the app will tell the shopper where to find the item in the store. Once a shopper scans the item with their smartphone, it can be charged to a credit card on file and the transaction is complete — eliminating the need to go through the checkout line. Executives added  “scan and go” could include paying at a kiosk, but they were also working on the automatic pay function using a credit card on file.

While the “scan and go” program is being tested, the company has not yet said when it will be rolled out for the general public.