Walmart to use more digital shelf labels, expand inHome delivery service

Bentonville-based Walmart, which has been testing digital shelf labels (DSL) since early 2019, announced Thursday (June 6) that a partnership with VusionGroup will add DSLs to 2,300 U.S. stores by 2026.

Greg Cathey, senior vice president of transformation & innovation at Walmart, said Walmart stores have more than 120,000 products on shelves, each with an individual price tag. DSLs flash when an electronic device is pointed at them by an item picker, which allows for quicker searchers by the item picker. Stockers also will see the label light up when the shelf needs replenishing.

Cathey said DSLs help Walmart better manage price changes and ensure empty shelves are quickly restocked.

“Our on-shelf levels are at record highs thanks to the use of technology in our stores,” Cathey said.

Walmart said while the DSLs are not used on all shelves, grocery and consumables categories do have them. Walmart said it continues to add DSLs in other categories on the general merchandise side of the stores.

Cathey said Walmart tested the technology with several companies but decided to co-develop the DSL it’s using with the VusionGroup. Cathey, who started his career as a stocker, said he understands how important this technology is to tens of thousands of Walmart employees.

Walmart and VusionGroup safeguarded the technology, and data is stored in the cloud within Walmart’s infrastructure, according to Cathey. The DSLs require no battery. He said the price changes will typically occur overnight, and safeguards are in place so that the price does not change while the store is open to customers. Walmart has tested the technology in several stores in Northwest Arkansas and in a few other markets, like Dallas.

“Price changes used to take me two days, now it’s done in minutes,” said Daniela Boscan, who works as a food and consumables team lead in the Dallas/Fort Worth metro.

Walmart execs also spoke Thursday as part of shareholders week about the use of RFID sensors on packages and pallets that allow stockers to locate inventory when they use mobile devices and the Me@ Walmart app. Cathey said the faster stockers could move inventory from the backroom to floor shelves; the faster sales conversions can occur. He said employee use of the Me@ app has reduced time spent in the backrooms by 66%, which means there is more time on the sales floor to help customers.

Walmart has tested drone delivery with three providers since 2021. Drone delivery has been available in Northwest Arkansas for the past two years in the Farmington and north Bentonville areas. Walmart recently announced the expansion of drone delivery in the Dallas/Fort Worth metro, reaching 75% of that population. Walmart has also piloted drone delivery in Arizona, Utah and Virginia.

Those using drone delivery previously had to access the drone company’s app that connected with Walmart’s inventory. The retailer said customers have asked for integration of the drone delivery feature into Walmart.com. Tom Ward, Walmart’s chief e-commerce officer, said when a customer shops on the app or the retailer’s website and lives in an area with drone delivery, that choice will soon pop up as a delivery option, eliminating customers having to access another site.

Walmart said it has completed 30,000 drone deliveries since 2021, indicating customers like and use the service. Integration to the Walmart app will be in phases as more drone delivery sites launch and delivery providers gain additional regulatory approvals to fly goods across greater distances. Walmart previously said it had the capacity to make more than 1 million deliveries a year, but the 30,000 made in the past three years indicates growth has been slow.

Customers pay an added fee—$3.99—for drone delivery. The weight limit is 10 pounds, and delivery can be as fast as 30 minutes. Walmart said 85% of items sold in a Neighborhood Market are weight-eligible for drone delivery.

Walmart also said it is expanding InHome delivery service to more than 45 million households in 50 U.S. markets including Boston, Detroit and Philadelphia. InHome is an add-on subscription for Walmart+ members for an additional $7 per month. Walmart+ membership costs $89 per year, or $8.17 per month. Ward said Walmart recently added replenishment with InHome service. He said replenishment, powered by artificial intelligence (AI), utilizes a personalized algorithm to predict customer needs and automatically place items into the cart with an InHome order to be delivered to customers’ pantries and refrigerators.

Walmart began testing replenishment in April and said customer feedback was positive. Walmart is also beta-testing a GenAI-powered shopping assistant. The application allows customers to speak or type in their search criteria like “items needed for a football tailgate party” and the AI shopping assistant replies with a list of items such as camp chairs, coolers, and games. Search results received by Talk Business & Politics did not include food, which required another search.

Ward said the shopping assistant is intuitive and search capabilities will improve.