Can AI Solve Erratic Online Grocery Out-of-Stock Substitutions? – RetailWire
June 28, 2021
As stockouts became increasingly common in the early months of the pandemic, personal shoppers at Walmart turned to artificial intelligence to help find the best substitutes.
“The decision to replace is complex and very personal for each customer,” said Srini Venkatesan, executive vice president, Walmart Global Tech, in a blog entry. “If the wrong choice is made, it can negatively impact customer satisfaction and increase costs. “
In the past, personal shoppers determined the best substitute for themselves, but Walmart has found that almost 100 different factors can go into that decision. Mr Venkatesan added: “Trying to take all of this into account would not only be too difficult, but it would also take a tremendous amount of time. “
AI technology uses hundreds of variables – including size, type, brand, price, aggregate buyer data, individual customer preferences, and current inventory – to determine the next best available item. He then preventively asks the customer to approve the substituted article. Whether the surrogate is approved or rejected, the information is fed back into AI algorithms to improve the accuracy of future recommendations. Following the deployment of the technology at Walmart, customer acceptance of substitutions has increased to over 95%.
It is not known how frustrating substitutions are for consumers. Some customers formed Facebook groups last year, such as “That’s it, I’m ashamed of grocery substitutions” and “Dumb Instacart & Shipt Substitutions,” to poke fun at weird substitutes.
A investigation From late April to early May of last year, the Retail Feedback Group found that 49% of online grocery shoppers were experiencing stockouts. Of these, 17 percent were able to purchase acceptable substitutes for all unavailable items, half were able to do so for some, and one-third found no such substitution.
A problem for customers may be the different methods used by grocers.
A recent review of several grocers by the Daily newspaper of Kankankee, Illinois, found that several of them had apps that allowed personal buyers to text customers to approve a substitute. One gave buyers the option to mark “no substitutions” on their items and another allowed the selection of acceptable second and third choices.
A number of UK based upstarts of which Weezy, Gorillas and Dija promise quick deliveries with the help of “no substitutions”.
DISCUSSION QUESTIONS: Are substitutions a major or minor problem for online grocery shopping? Do you think grocers should look to artificial intelligence or other enforcement measures to improve the experience?
“Huge problem, potentially a good solution. “