For many shoppers, searching for products in large Walmart stores can be a frustrating experience. However, the world’s largest retailer is now testing digital labels that light up when activated with an app, allowing customers to follow a blinking light to the right shelf.
The devices are already in use by employees at a few dozen stores, where they flash green to help shelf stockers and blue to assist product pickers fulfilling online orders. Walmart plans to pilot the use of these lights for customers later this year, with further details about the color not yet disclosed.
This innovation is made possible by Walmart’s efforts to automate the warehouses that supply stores and online merchandise. The company aims to enhance profitability and productivity and demonstrate to investors that it is not just a slow-growing behemoth.
As Walmart invests in higher-margin businesses like digital advertising and finance, it is also seeking to generate more revenue from stores and e-commerce without significantly increasing its workforce.
John Furner, Walmart’s chief executive officer of US operations, stated that while the number of workers at Walmart would likely be about the same in five years, the company’s business would be larger and there would be different job functions compared to today.
Walmart has indicated that the unit cost of moving goods is expected to decline by 20% in the coming years due to the increased use of robots in the supply chain. For example, a Walmart Supercenter in Grapevine, Texas is now supplied by three highly automated warehouses that combine robotics with human labor to boost capacity, accuracy, and speed.
One of the three facilities, a non-refrigerated distribution center, was retrofitted with more automation equipment. The other two are entirely new and include a refrigerated warehouse and a fulfillment center for online orders.
This new system has streamlined the steps needed to unload goods, reducing the time required and minimizing walking distances for employees. It has also led to a more efficient handling of orders and lower the amount of walking needed to complete tasks, from 9 miles per day to much less.
In addition to improvements in its supply chain, Walmart’s online business competes with e-commerce giant Amazon and is vital for retaining higher-income customers who have increased their purchases from Walmart in recent years.
To address challenges such as out-of-stock items, store-based fulfillment centers now maintain an inventory specifically for online orders, separate from the sales floor. An internal app gives store employees real-time information on product availability and location.
Furner, mentioned that one particularly challenging aspect for a retailer is managing variability in inventory, which includes determining the status and location of products.
Moreover, Walmart employees have reported that changing prices was a difficult task. With the new digital labels, employees can update price tags with a mobile app, making the process simpler and quicker. Walmart plans to install digital shelf labels in 500 stores as part of its pilot project introducing the lighting system to customers
The company has acknowledged that many regular customers may not require the shelf-light feature, as they are already familiar with the store layout. Walmart’s external app also has the capability to direct shoppers to the correct aisle for products.
Despite initial skepticism, it is uncertain how shoppers will respond to the option of using shelf lights. However, one shopper, Eva DeJesus, admitted that she sometimes struggled to locate specific products in the store.
