Wal-Mart eyes drones in stores, invests in sports marketing and Chilean business unit
Wal-Mart Stores recently received a U.S. patent for a system that would allow the retailer to use drones to move products between departments.
Patent No. US 2017/0076354 was granted earlier this month with the inventors located in the retailer’s Bentonville home office named on the patent application. The retailer filed the patent application in September 2016. Essentially the patent would allow the retailer to fly drones over customers’ heads in its stores.
In the application Wal-Mart said there is a need to improve customer experience and convenience. The example provided by Wal-Mart involved using drones to gather items from the back room that the shopper purchased online and is picking up in store. The present system requires a store worker locate and bring the item out to the shopper. If there isn’t an employee available then the customer pick up is delayed, translating into a non-favorable experience.
Using a drone is a way to leverage technology to better serve customers. Wal-Mart also noted in its application that increasing competition from online-only retailers requires brick and mortar players to re-think convenience models and continue to improve the overall shopping and pick up experience.
Wal-Mart’s patent allows store computer systems to command the drone flights as needed. The drones themselves would have sensors to detect obstacles. Stores using drones would also have to create several drone landing zones, some of which might be within a customer’s sight.
Wal-Mart has not said if or when it plans to use the drones in its stores for product retrieval. The retailer has said it was testing drones in its retail operations, including distribution and fulfillment centers.
SPORTS MARKETING DEAL
Wal-Mart Stores has inked a three-year marketing deal with the Oak View Group, sports promotion company for professional hockey and basketball. The deal is reportedly valued at $40 million and involves 21 sports arenas around the country such as the The Forum in Los Angeles and the United Center in Chicago that will call Wal-Mart their “official big box retailer.”
The deal also allows Walmart U.S. to market itself to sports fans by calling attention to a new program dubbed “Walmart Community Players” which celebrates local residents who work in education, fighting hunger and sustainability which align with the retail giant’s corporate endeavors.
Oak View said this is the first time it has worked with the Bentonville-based retailer, and the deal allows Wal-Mart to reach 70 million people a year through the high profile sports facilities. Dan Griffs, co-owner of Oak View Group, recently told the media that Wal-Mart liked the national platform with arenas located in the top 25 markets and this one contract provides economies of scale.
Wal-Mart declined to comment on this new marketing deal, but Chief Marketing Officer Tony Rogers recently told suppliers the retailer was looking to grow its marketing partnerships with the Oscars, Food network and professional sports. He said the new marketing strategy looks to “infuse the brand into pop culture.”
Recently Wal-Mart was an official sponsor of the Academy Awards and Rogers said the retailer will use popular, recognizable music to score their ads. He said using hit songs improves consumer scoring of the ads.
Wal-Mart Stores also said it will invest $800 million in its Chilean retail brand Lider in the next three years, despite the nation’s sluggish economic growth largely tied to copper mining. Walmart International will open between 55 and 60 new Lider supermarkets and remodel 50 stores while also adding a large distribution center near Santiago. This investment will also mean 5,000 new jobs created in country by 2020.
The distribution center is under construction with a projected cost of $180 million and it will employ 2,000 workers when completed next year. Walmart Chile also plans to improve its online division and the new fulfillment center could help with that effort.
Officials with Walmart Chile released the following statement regarding the recent announcement: “We are confident in the future potential of the country, and we are convinced that spaces exist to continue expanding our low-cost model. Both in the high and low moments of the economic cycle, consumers are always interested in using their budget efficiently, and this will continue being our focus.”
Walmart International first entered Chile in 2009 by taking a majority stake in Chile’s largest grocer. Walmart Chile is based in Santiago and now operates 363 retail stores under four brands, Lider Express and Lider Hyper, Superbodega Acuenta, and the convenience format Ekono. Walmart Chile employs about 49,000.