There are full weeks in the race to control the consumer's whole paycheck — and then there are very full weeks. This week was one of the latter, as Walmart hosted its investor meeting in Arkansas and Amazon decided this week’s menu of technological innovations in retail would be an all-you-can-eat buffet.
And that was just the serious stuff. On the less serious side, Amazon Senior Vice President of Devices and Services David Limp admitted something we’ve all long suspected — that Alexa is Amazon’s attempt to “kind of invent the Star Trek computer.” Limp admitted they are some years off from getting there — but was pretty adamant “that shining star that is that Star Trek computer. We think we can have that.”
Lucky for Amazon, it also has a pretty good lead on a spaceship to put it in when it’s ready.
Walmart, on the less serious side of a very serious week, gave it employees a fashion upgrade, announcing its iconic royal blue and yellow vests for employees are being retired. The new vests are slate grey with hot pink, lime green or royal blue trim; are made from recycled bottles and come with larger pockets.
“Our vests just got an upgrade, so associates can live their vest lives at work,” Walmart said in a tweet for which it has, as yet, failed to apologize.
But it was a busy week, so it is possible it hasn’t had time yet. And speaking of that busy week ...
Big Play of the Week: The Automation Station — Drones, Robotic Drivers And Robohands
For those keeping score at home tracking Amazon’s various attempts at automating and roboticized its operations, the scoreboard lit up this week an awful lot.
The biggest, and most immediately pressing, announcement in the packet was the news that drone delivery is about to step out of the theoretical future into the actual present.
Amazon says it will have drone delivery up and running service within months. The announcement was made by CEO of Worldwide Consumer Jeff Wilke on Wednesday (June 5) at the company’s “re:MARS” conference in Las Vegas.
The drone will be designed to lift off and land like a helicopter — and comes with upgrades to its stability and motion over previous models. Amazon also says it will be able to perceive objects in motion around it better than the human eye.
Amazon has been pushing drone delivery for several years, and has done some limited testing of the concept in the U.K. — but this announcement was unique in placing a time frame as to when drones will be launching. The firm in the past has struggle with both design and regulatory issue around flying devices.
According to Wilke, fully electric drones can fly up to 15 miles and can transport packages under five pounds, which is the majority of what the eCommerce retailer sells.
Drones, however, we not the only big automation news this week at the re:MARS conference: Amazon Robotics VP Brad Porter further announced that the company has 200,000 robotic drives around the globe. Earlier in the year, the company said it had 100,000 robot systems throughout its 25 fulfillment centers in the U.S. — indicating the progress is moving along quickly. Though not in a way that is deleteriously affecting human workers, according to Amazon.
“While these robots provide a critical function in our buildings, we are not automating away all the work,” Porter said. “In that same time frame, we have added over 300,000 full-time jobs around the world.”
And while most of the robotics news this week was concerned with the present or the fairly immediate future, Amazon CEO Jeff Bezos also did some forecasting in the longer term, predicting that fully-functional robot hands would be in existence in the next decade.
“I think grasping is going to be a solved problem in the next 10 years,” said Bezos. “It’s turned out to be an incredibly difficult problem, probably in part because we’re starting to solve it with machine vision — so [that means] machine vision did have to come first.”
Voice Improvements: Alexa’s Commerce and Conversational Skills Improve
While there have been naysayers, who argue that artificial intelligence (AI) voice assistant users are more likely to want a weather report than to conduct commerce, Patrick Gauthier, vice president of Amazon Pay, is bullish on voice payments, and says he believes they will change the payment industry in much the same way mobile phones have.
He said the technology is a “new era in commerce. It is akin to what happened with mobile maybe 10 years ago or even with eCommerce 20 years ago.”
As voice assistants become more ubiquitous, and consumer concerns about safety are resolved, Gauthier says the move toward shopping by voice in inevitable. Gauthier cited a recent Amazon Pay survey that found over 40 percent of people would use voice assistants over the course of the next three years.
“The potential is phenomenal,” Gauthier said. “Just like mobile 10 years ago, there is a lot we need to learn. There is lot we need to understand about what are the right use cases because trying to do with a smart assistant what already works well in a mobile would be really a waste of everybody’s time.”
And, perhaps to pick up the pace of tapping that phenomenal potential, Amazon concurrently announced this week efforts to up the level of Alexa’s conversational game.
Amazon has announced the launch of Alexa Conversations, a new deep learning-based approach that developers can use for creating natural voice experiences on Alexa with less effort, fewer lines of code and less training data.
“This new model helps developers create natural, flexible dialogs within a single skill and in the upcoming releases brings multiple skills into a single conversation,” Drew Meyer wrote in a blog post.
The move comes, according to the post, as users are tapping Alexa for increasingly complex tasks like ride booking, shopping, ticket purchasing or making reservations. Consumers would like to be able to speak with Alexa fluidly across multiple topics. Amazon, meanwhile, would like to see Alexa learn to predict a customer’s true goal from the direction of the dialog and offers up the appropriate skills through Alexa Conversations.
Currently available in developer preview in the U.S., the tool combines an AI-driven dialog manager with an advanced dialog simulation engine that automatically generates synthetic training data.
“Alexa Conversations helps you quickly create interactions that are more conversational, and not forced into strict patterns or sequential workflows. In the past, developers scripted every potential turn, built an interaction model, managed dialog rules, wrote back-end business logic, and analyzed logs to test and iterate. For example, the Atom Tickets skill used 5,500 lines of code and nearly 800 training examples,” explained Meyer.
And just when you thought there couldn’t possibly be any more tech upgrade news this week, one more snuck out over the finish line.
Dressing for Success: Amazon Ads Image Search for Fashion
That Amazon is making a major push into apparel retail is, at this point, well known to everyone. Between things like the proliferation of private-label brands and the try-before-you buy Prime Wardrobe offering, Amazon has made it clear that it would very much like to help us all dress a little better.
And it has rolled out its latest offering to make its wares easier to find.
Amazon’s Consumer Worldwide CEO Jeff Wilke has announced a new AI-powered fashion search tool called StyleSnap, designed to help customers visually search for outfits they’d like to purchase.
It is designed to allow a user to snap or grab an outfit image, upload it and have the StyleSnap tool “match the look in the photo” and find similar items that are for sale on Amazon.com.
“The simplicity of the customer experience belies the complexity of the technology behind it,” Wilke said.
This is not Amazon’s first go with this type of release — in 2017 Amazon rolled out the Echo Look, which would provide users with clothing recommendations after using AI to analyze an outfit. According to a review by The Verge, the tool often made mistakes, could not identify different outfits and was repetitive with its tips. Style Snap reportedly has improved on those issues.
Big Play of the Week: Delivery’s Next Phase
The delivery game of one upmanship between Amazon and Walmart this week added a new dimension, with Walmart announcing it could do better than delivering groceries to the customer’s door — it can get them all the way into the fridge.
Coming this fall to select cities, consumers will be able to have groceries delivered and placed in their refrigerators when they are not home. Called InHome, the service will send orders in Walmart vehicles and manned by Walmart workers equipped with proprietary wearable cameras.
Using as yet unspecified “smart entry technology,” delivery people will be able enter homes to make deliveries, while customers are able watch the deliveries remotely.
The InHome service will launch in three cities to start: Kansas City, Missouri; Pittsburgh, Pennsylvania; and Vero Beach, Florida. Delivery fees for the new service were not announced, nor were any details for how Walmart employees will gain entry into homes. Amazon, notably, tried a similar program in 2017 — but it was disbanded about a year later.
Personnel Plays: New Leadership Coming to Store No. 8
Walmart’s investment arm and startup incubator Store No. 8. Will soon be under new management. Walmart has named Scott Eckert as its new SVP.
Store No. 8 was created by Marc Lore, to create partnerships AI innovators and emerging tech entrepreneurs. Since its inception, Store No. 8 has been involved with initiatives including Jetblack, a same-day delivery service that enables customers to text their orders for same-day delivery; Spatialand, a virtual-reality software maker acquired in 2018; and Project Kepler, which aims to compete with Amazon Go.
“I’m excited to welcome Scott Eckert to Walmart as Senior Vice President, Next Generation Retail and Principal, Store No8. Scott’s background as a global technology executive and entrepreneur make him a perfect fit to lead Store No8 and its mission of incubating technologies that can transform the future of retail,” Lore wrote in an internal email to employees obtained by PYMNTS.
Eckert most recently was at Bain Capital Ventures, where he has been evaluating potential new investments and advising CEOs of existing portfolio companies as executive in residence.
“As someone who has spent the past 20 years working with or as an entrepreneur, new business creation is a core part of my DNA. For any entrepreneur excited to create new ways to serve customers, there is no better place to start a business and have impact at scale than Walmart,” said Eckert in an emailed statement. “I’ve always enjoyed working with other entrepreneurs in a vibrant startup ecosystem, helping them navigate the complexity of creating and building something that matters — that’s what we’re doing at Store No8 and I’m delighted to be part of it.”
And speaking of investments and innovations, Walmart also announced this week a commercial partnership with two-year-old self-driving startup Gatik.
“We are a strong believer in autonomous vehicle technology, and we look forward to learning more about how Gatik’s innovation can benefit our customers in the coming months,” Walmart’s Senior Vice President of Digital Operations Tom Ward said about the partnership.
Advocacy Turn of The Week: Walmart, the Workers' Champion
In a move at the company's annual shareholders meeting that certainly generated some surprise this week, Walmart CEO Doug McMillon openly and directly advocated for Congress to hike the minimum wage of $7.25 an hour. There has been no minimum wage increase in the U.S. since 2009.
“The federal minimum wage is lagging behind,” McMillon said at Walmart’s annual shareholders meeting in Bentonville, Arkansas on Wednesday (June 5).
McMillon went on to note that, given the possibility of unintended consequences, local cost of living differences should factor into how the wage raise is determined. He also said that a hike may need to be phased in over time.
Walmart has raised its wages by 50 percent over the last four years, McMillon noted, and has also expanded its benefits and training opportunities. In some markets, Walmart pays more than $11 per hour as a push to “recruit and retain the talent we need to run a good business,” he added.
The push for higher minimum wage across the board for workers, however, was Walmart’s second big piece of labor advocacy this week.
Walmart also announced it will be expanding the program by which it allows full-time and part-time employees to access a college degree for $1 a day — by adding more eligible degrees, college partners and a new path for high school students to its one-year-old program offering.
Joining the list of eligible schools are Southern New Hampshire University, Purdue University Global and Wilmington University — bringing the program up to offering a total of 14 associate degrees, bachelor’s and certificate options in technical fields such as cybersecurity and computer science. Guild Education is on the online marketplace through which the program is accessed.
About 7,500 employees participated in the program in its first year, and the goal, according to Walmart spokesperson Michelle Malashock, is to scale up the offering.
“We want to focus on building that talent pipeline and building a bridge into the workforce,” Malashock said, adding that most Walmart employees pursuing the company’s education benefit begin their studies in the Guild Education College Start program.
That program serves as a general education baseline to help prepare students for a wider array of coursework.
So what’s the takeaway this week?
That Newton’s third law of motion — that every action has an equal and opposite reaction — works just as well in a race between two commerce giants as it does in predicting the behavior of physical objects. Whatever Walmart or Amazon does — they can almost be sure they’ll see an answer of some kind out of the other.
Luckily, we’ll be here every week to keep track of who is acting — and reacting — in real time.