Walmart Canada Puts Customer Experience at Center Stage

Walmart’s 2020 can be epitomized by one word: realignment. The mega-retailer, like many other big box stores, suffered a small hit at the beginning of the pandemic, but then went on to see huge sales increases. A large chunk of that increase came purely from online shoppers as they looked to avoid in-person contact and instead opt for grocery delivery, curbside pickup, and traditional e-commerce. 

That trend towards digital-first shopping prompted Walmart to reconsider its overall approach to how consumers will shop in 2021 and beyond. In the span of just one month, from mid-March to late April, it seemed like the emphasis on in-store shopping was completely erased. The demand for digital fulfillment overwhelmed every large retailer on the planet and signalled what seems to be an irreversible shift towards online shopping. 

Nicolai Salcedo, Walmart Canada’s chief information officer, sums up the retailer’s 2020 with what might be the understatement of the year: “Things got very interesting, very quickly.”

Salcedo joined Walmart in mid-2019, mere months before the COVID-19 pandemic would change the world and fundamentally upend operations for businesses of all sizes. However, Salcedo says that the quick pivots Walmart needed to make to accommodate shoppers during the pandemic were in line with the company’s overall strategies—they simply needed to be put into place faster.

“COVID accelerated many of our digital aspirations,” Salcedo says. “For Walmart Canada, our ideal digital experience, whether it is in-store or online, starts with our customers in mind. We start designing things by listening to what our customers need.”

The digital customer experience

Walmart has used customer experience as its north star throughout the pandemic. The company has focused its energy and resources throughout 2020 on fine-tuning its digital experiences, guided by the new reality that the online shopper and the in-store shopper are now, essentially, the same person.

“This is not two separate sides of a coin,” Salcedo says. “It’s not that you’re Customer A when you go online, and Customer B when you shop in-store.”

Due to COVID-19, Salcedo says those two customer journeys have effectively been blended; Walmart’s path to success, then, has been the omnichannel.

Case in point: in July, Walmart Canada announced a $3.5 billion investment (though, over the phone, Saldeco says the number is slightly higher) in “stores of the future.” One central tenet of this investment has been $110 million that is earmarked for online-focused physical upgrades, such as the construction of two new micro-fulfillment centers. An existing hybrid concept store, in Vaughan, Ontario, currently serves as an incubator to test omnichannel capabilities and features. The investment also includes a plan for 10 hybrid locations, with expanded fulfillment space; renovations to make space for e-commerce capabilities; the expansion of Walmart Grocery Pickup to 70% of Canadian locations by the end of the year; and the hiring of new staff who will be assigned to omnichannel-related roles. 

The upgrades reflect a hybridization of Walmart’s digital and physical shopping experience for customers. Electronic shelf labels, shelf scanners that monitor product volumes, and a new checkout experience that reduces touchpoints blends the look, feel, and function of Walmart’s web, app, and brick-and-mortar shopping experience for customers. The focus, in other words, is on a retail experience that has, due to COVID-19, become omnichannel by default. 

No longer are customers simply arriving at stores and shopping or checking out online. They are making web purchases that are fulfilled by stores close to them and navigating in-person shopping with the expectation of a seamless, contact-free experience that has been cultivated by the ease of buying online. 

“Digital and analog channels no longer separate; they’re mixing for good reason,” Salcedo says. “So they should be seamless for the customer. No one will deny that time is the new currency. And, for that reason, leading with technology is mandatory.”

Although the service has not yet debuted in Canada, the launch of the paid subscription Walmart+ also truly defines the retailer’s push towards blending online and physical shopping experiences. Walmart+ launched earlier this year in the U.S. in September and originally offered free delivery for orders over $35, but just two months later, that minimum was dropped, with Walmart CEO Doug McMillon saying, “One of the worst things we could do would be to sell a bunch of Walmart+ memberships and then have [members] be dissatisfied because they can’t get fast delivery times or spots.”

The elimination of delivery minimums, combined brick-and-mortar benefits such as fuel discounts and streamlined checkout processes, proves Walmart’s push towards using elements of the digital customer experience to influence its in-person processes. 

The power of the Walmart app

In early April, Walmart Grocery became the number one shopping app in North America, surpassing Amazon by 20%. The top spot has since switched back and forth, but the move to first place showcased the power (and demand) of Walmart’s mobile presence and highlighted how the app became a central part of the Walmart shopping experience almost overnight. 

Capitalizing on this surge in its app ecosystem, Walmart rolled out a mobile check-in capability in 2020 for grocery pickups, meaning customers can just tap a button as they pull up to pick up their orders and have it brought out right away. The feature means there is no need for a phone call or to even go into a store, instead relying on a device everyone has in their pocket to bridge the gap between e-commerce and physical shopping. 

Another app feature new in 2020 that blends shopping experiences is called Scan & Go. The technology allows shoppers to scan items with their phone as they put them into the shopping cart and keep a running total. The shopper then scans the final total on a self-checkout machine, pays with their phone’s digital wallet, and out they go. If an item is out of stock, a shopper can even scan its UPC code and add it to their online cart to be ordered later. 

For Salcedo, while many of these changes have been implemented or accelerated because of COVID-19, changes in Walmart’s operations are built to last. 

“As we continue to excel online, and we leverage data to move faster, hopefully, customers will say, ‘You know what, that was a good experience. I wouldn’t mind doing that again,’” he says. “They just didn’t know about these experiences until the need appeared.”

In-store innovation

Back-end efficiency is key to ensure the digital experience never suffers. Customers have always wanted to be able to complete their shopping journey as quickly as possible, and that desire has only been accelerated by the safety concerns brought on by COVID-19.

Walmart began investing in and implementing new AI tech that has automated a number of behind-the-scenes processes, from inventory management to selecting replacements for grocery order items that are not available in-store. Part of the company’s $3.5 billion investment has gone towards retrofitting more physical stores as fulfillment centers, enabling it to deliver online orders more expediently and frequently. The company has also launched a waitlist feature, which allows customers to reserve a time slot to shop in-store, thus allowing customers to avoid lengthy outdoor waits in the cooler months while allowing Walmart staff to better manage store capacity, and has automated its in-store routing.

And speed has been a priority in more ways than one: In Ontario, when the province implemented new lockdown and store-capacity measures during the second wave in November, Walmart staff needed an effective, accurate way to measure how many customers were in a store at a time. The new restrictions were announced on a Friday; by Monday, Walmart’s technology team had developed a customer-counting app.

“We’re moving with the needs of the market as fast as we can,” Salcedo says, “and, in some cases, that has required overnight delivery.” 

Walmart’s 2020 launches and expansions have existed outside of in-store modernization, as well, but always with an eye to an improved customer experience. Before the pandemic hit, Walmart Canada planned to expand its online grocery fulfillment by 70 stores by the end of 2020; the company added 63 new stores by the end of April. Walmart has also partnered with Interac for contactless payments and even begun experimenting with drone delivery in the U.S. Notably, the company inked a historic deal with Shopify, allowing that company’s merchants to list their wares on Walmart’s website. The move allowed Walmart’s third-party platform, Marketplace, to double in size this year.

Salcedo doesn’t deny that the Shopify partnership better positions Walmart to compete with other e-commerce giants such as Amazon. He does insist, however, that the move was made as part of its overall customer-centric strategy.

“[The Shopify deal] expands our capacity to deliver more orders to more customers,” he says. “There’s not really a story behind the story.” 

And, of course, the company will continue to innovate moving forward, with store renovations currently underway and the plan for a higher level of AI integration in 2021.

“We recognize that what brought this company to be what Walmart is today is not going to be sufficient moving forward,” Salcedo says. “We need to reinvent ourselves to a certain extent, and evolve to serve our customers. This is not the end of the journey; this is a milestone in a journey that will continue.”