Fast Five Shorts | Buy Or Sell: Walmart’s New AI Tool For Merchants, Aka Wally?

Summary

Omni Talk Retail Episode Summary

Title: Fast Five Shorts | Buy Or Sell: Walmart’s New AI Tool For Merchants, Aka Wally?
Release Date: February 27, 2025
Host: Omni Talk Retail
Guests: Chris Walton, Anne Mezzenga

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1. Introduction to Walmart’s AI Tool: Wally

The episode kicks off with the host introducing Walmart's latest innovation in the retail technology space—Wally, an internal generative AI tool designed to revolutionize how Walmart’s merchandising team analyzes sales, pricing, and inventory data.

“Wally uses a familiar chat style interface to retrieve relevant data from Walmart's databases while accurately interpreting product industry jargon and category names.”
— Host [00:00]

Wally is engineered to provide rapid responses, whether through quick answers, tables, or comprehensive reports, significantly speeding up the data analysis process. To ensure accuracy, Walmart has implemented automated tests and trained an AI judge to evaluate Wally’s outputs against human-annotated samples.

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2. Impact on Merchants and CPG Suppliers

The conversation deepens as the host poses a critical question to Chris Walton, drawing from his extensive merchandising experience:

“Are you buying or selling Wally, Walmart's new AI tool for merchants?”
— Host [00:55]

Chris navigates this multifaceted question by addressing two primary impacts:

a. Impact on Merchants

Walmart's merchants stand to benefit immensely from Wally by reducing the hours spent on data combing and enhancing decision-making efficiency.

“If this works like they're saying it does, it's a massive game changer. It's massive both for the long term time savings and also keeping everyone on the same sheet of music.”
— Chris [03:16]

However, Chris also highlights that while Wally can streamline data analysis, merchants will need to adapt to new expectations of efficiency and productivity.

b. Impact on CPG Suppliers

Wally introduces an asymmetry of information between Walmart and its suppliers, potentially giving Walmart a stronger negotiating position.

“Walmart has all the data and can analyze it in this way with all these fancy new AI tools as well. So, so it's going to be tricky.”
— Chris [02:31]

Suppliers may feel anxious about keeping up with Walmart’s enhanced data capabilities, which could pressure them to add more value to maintain favorable terms.

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3. Wally’s Potential in Training Merchants

The host explores whether Wally could serve as an effective training tool for new merchants, particularly those starting as buyer’s assistants or analysts.

“For example, like, saying, ‘Hey, how do my sales in the south compare to my sales in the north?’ That simple question probably takes the average retailer a very long time to pull.”
— Chris [05:01]

Chris acknowledges the vast data available to retailers but praises Wally’s ability to make this data accessible and understandable, potentially accelerating the training process for new merchants.

“If I can work in the background and then you can actually... forecasted in the future... you can just go crazy with this.”
— Chris [05:01]

He remains cautiously optimistic, expressing hope that Wally will effectively bridge the gap between data analysis and the strategic aspects of merchandising.

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4. AI Enhancing Retail Operations and Efficiency

The discussion broadens to include the role of AI in improving day-to-day retail operations beyond just data analysis. The host shares insights from other industry professionals, such as Andre Reebov, CEO of Scentbird, who are leveraging AI to streamline operations.

“Andre Reebov... are using AI to completely eliminate the one on one meetings.”
— Host [06:06]

These AI-driven efficiencies not only enhance productivity but also improve the overall work experience by reducing mundane tasks.

Chris emphasizes how AI tools like Wally can standardize and objectify routine processes, making meetings and decision-making more data-driven and less reliant on manual report generation.

“AI should drive the discussions in your morning huddle because it's objective.”
— Chris [03:20]

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5. Future Implications and Closing Thoughts

As the episode nears its conclusion, both the host and Chris reflect on the broader implications of integrating AI tools like Wally into retail operations.

“I think it's impossible to move speed without some of these tools.”
— Host [08:18]

Chris agrees, noting that while AI can manage complex pricing strategies and category impacts that are beyond human capacity, it also liberates merchants to focus more on the creative and strategic elements of merchandising.

“I hope tools like this actually pull the merchants out of the spreadsheets and out of the like the data analysis thing.”
— Chris [07:40]

The conversation concludes on an optimistic note, with both parties expressing high hopes for Wally’s potential to transform retail merchandising.

“Wally, we have very high hopes for you. Don't let us down.”
— Host [09:30]

“And so that's the beauty here.”
— Chris [09:30]

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Notable Quotes with Timestamps

• “Wally uses a familiar chat style interface to retrieve relevant data from Walmart's databases while accurately interpreting product industry jargon and category names.”
  — Host [00:00]

• “Are you buying or selling Wally, Walmart's new AI tool for merchants?”
  — Host [00:55]

• “If this works like they're saying it does, it's a massive game changer. It's massive both for the long term time savings and also keeping everyone on the same sheet of music.”
  — Chris [03:16]

• “AI should drive the discussions in your morning huddle because it's objective.”
  — Chris [03:20]

• “Wally, we have very high hopes for you. Don't let us down.”
  — Host [09:30]

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Conclusion

This episode of Omni Talk Retail provides an insightful examination of Walmart’s new AI tool, Wally, exploring its potential to transform retail merchandising through enhanced data accessibility and operational efficiency. Chris Walton offers a balanced perspective on the benefits and challenges that come with integrating such advanced technology, highlighting both the opportunities for improved productivity and the pressures it may place on merchants and suppliers alike. As AI continues to evolve within the retail sector, tools like Wally signify a pivotal shift towards more data-driven and streamlined operations, promising a future where merchants can focus more on strategic decision-making and less on time-consuming data analysis.

Transcript

[Host]

Walmart has a new internal AI tool that helps Walmart's merchandising team analyze sales, pricing and inventory faster than ever. According to Fast Company. To help merchants quickly access and analyze relevant information, Walmart has introduced Wally, an internal generative AI tool that can dive into internal data to create responses in just seconds. Wally uses a familiar chat style interface to retrieve relevant data from Walmart's databases while accurately interpreting product industry jargon and category names. Wa Wally can then generate quick answers tables or full reports as needed. To make sure that Wally gives accurate answers, Walmart has developed automated tests where the tool's numeric responses are checked against known answers. The company even trained an AI judge to evaluate the software's conversations based on human annotated samples. Chris, I have two questions for you.

[Chris]

Okay.

[Host]

First, are you buying or selling Wally, Walmart's new AI tool for merchants? And second, this is also the A and M put you on the spot question.

[Chris]

Oh, God. Yeah, we haven't had it yet. Wow. Okay.

[Host]

A and M wants to know. It makes a lot of sense that Walmart is making data more accessible given the vast hours merchants spend combing through data and looking for insights to optimize their decisions, address executional challenges, or give them negotiation leverage. Walmart's been pushing on this front for several years. But the question is now, with this live, how do job expectations for Walmart merchants change with this tool at their disposal? And what challenges will it put on CPG suppliers to add value as Walmart becomes more data savvy? This is a perfect question for you given your merchandising experience throughout the years. What does this mean? And are you buying or selling?

[Chris]

Wow. Okay. All right. So there's a lot of meat on both those bones. I don't know how much time we have, but I think I'll take the A and M put you on the spot question first. And I think. Okay, I think that. I think that question is a great one and there's really two parts to it, like what is the impact to the merchants? And then what is the impact to the cpg? I'm going to take the CPG part first because Walmart having this tool, this technological capability, I think is really interesting because it creates an asymmetry of information between Walmart and its supplier community. And whenever there's an asymmetry of information, it's always an advantage in negotiations. So, yes, the supplier community is probably a little anxious today. Sure. About reading this news because they're going to have to keep up. But yet Walmart has all the data and can analyze it in this way with all these fancy new AI tools as well. So, so it's going to be tricky. So, but here's the other thing, all right, going back to the other question, which, which will get me back to the other part of the impact on the merchants too, in the question, am I buying or selling this? I want to buy this so hard. And I want to buy so hard because as soon as I read this, I sent a message via LinkedIn to Brian Knapp, the SVP of merchandising transformation is quoted in the article asking him to come. Please join us and talk about it with us on our five insightful minute segment. So, because I, I this is a major issue across every retailer. One of the biggest frustrations and stress points of any merchant. Any merchant and is the Monday morning meeting. It is terrible. And oftentimes this is what pissed me off the most. Oftentimes the success of those meetings was 100% dependent on one, who had the time to come in early and pull a bunch of reports and two, who knew how to pull those reports the best. Both of which are two skills that have absolutely nothing to do with merchandising. So that's still going to be a little bit of the case because you're still going to have to understand how to use this like chat GBT style analysis tool. Right? I know for those listening, I'm speaking the language of the merchant right now because so if this works like they're saying it does, it's a massive game changer. It's massive both for the long term time savings and also keeping everyone on the same sheet of music because as I said before, last point I'll make is AI should drive the discussions in your morning huddle because it's objective. It's much more objective than the DMM's wife telling, telling her husband over the weekend, hey, I was in this store and I saw this. Can you make sure your team looks into it? That used to happen and it's so frustrating when you've pulled all these reports and your whole day is now thrown off and so yes, but the bar is going to be raised for the merchants to A and M's question, like the bar is going to be raised, you're going to be expected to do more and, and you're going to expect it to be more efficient and more productive and drive more volume if the tools work like Walmart is purporting that they do well.

[Host]

And Chris, I mean, do you think that this could actually be an effective tool in training them. Like if you have, if you're a new merchant, like many people start out in their retail careers as being a buyer's assistant or an analyst. Like, couldn't this, could this be an easier way of kind of training yourself if you had to? Or is that not. Do not.

[Chris]

Oh, yeah, no, for sure. I mean, I mean it's, it's amazing the amount of data that we all have as retailers, but how hard it is to get it in a way that we can understand it. So like, for example, like, you know, say you were talking to Denise yesterday about the Scoop clothing line and you're like, yeah, hey, how, how do my sales in, in the south compare to my sales in the North? That simple question probably takes the average retailer a very long time to pull. But if I can work in the background and then you can actually. And then you can go, oh, now tell me how it looks in Miami versus versus Fort Lauderdale and where are my in stock opportunities? Where am I going to have, where am I going to have, you know, inventory outages forecasted in the future? Like, you can just go crazy with this. So that's why I'm a little, still a little bit skeptical about how well this thing works. Yeah, but it's cool that they're trying to do it and they're publicly talking about it too, because it's going to be a differentiator as people gravitate towards working at the places that try to make them work easier and not harder as well.

[Host]

Right. I was even talking about like just being able to put it into an Excel spreadsheet or graph or chart or something like. Right, yeah, no, for sure.

[Chris]

Yeah.

[Host]

Saves that work on their side too to like get to a point instead of having to like teach somebody how, how to do, you know, all of that, that busy work. Really. And it's been interesting too because I've been asking that question of a lot of people here at Etail to Chris, like, how are you using AI in your day to day right now? And like one of the really interesting ones, Andre Reebov, he's the CEO of scentbird, I interviewed him yesterday. He was on a panel with a bunch of other CEOs and they are using AI to completely eliminate the one on one meetings. So like the whole thing is like eliminate opportunities for people to complain about their jobs basically. So instead they're sending bots that are interviewing people throughout the weeks. Like you'd be having an AI conversation, like a language based conversation with the, with your, your surveyor who's a bot. Yeah. But then they collect all this info and then when you have your one on ones that's like, here's how you've been doing. These are the things that we should just like you said for the Monday morning meeting, like, these are the ways that these AI tools are, are really finding efficiencies in business that might not be like an immediate, oh, this is changing our bottom line, but I think improving the day to day life of work. Um, so I, I think this is a great, I'm super pumped for Walmart. Even if it's just like baseline stuff that they're starting to do right now to remove this, this friction and to get to this data faster and have somebody be able to like work off the same, the same kind of dashboard of data and get to making those decisions faster. So I love it. I think it's huge.

[Chris]

Yeah, it's a great point. Yeah. Like review writing processes should be fist faster and more objective. The other point too then that we talked a little bit about last week with Lisa Collier, which you know, I was kind of like vibing with her as she was talking a lot because she is a former merchant too. Like the, I hope this, I hope tools like this actually pull the merchants out of the spreadsheets and out of the like, like the data analysis thing. And it gets them back to like thinking about and, and the art of merchandising in terms of driving product and putting it on display in the right way in the store and standing behind things with a point of view. The thing that I cannot do, that I cannot do, at least not right now. And so that's what I hope this, I hope ultimately comes from this.

[Host]

Yeah. And I think in closing, Chris, I think the, it's only going to get more complicated. Like again, like Matt Pavich from Revionics is going to be on tomorrow and he's talking about like just how, you know, the number one thing that everybody's freaking out about right now is like regulations outside of their control with potential tariffs and all these things happening and you're, you're just going to be buried in the details of that business trying to figure out how to make sure pricing is accurate or all these things and you won't be able to see, stand behind your product like you're talking about. And I, I just, I think it's impossible to move speed without some of these tools, so.

[Chris]

Yeah, but it's, it's liberating. You're right. Yeah. You're right, sorry. I just keep going on this. But like, because like the. One of the most eye opening things that Matt said in that interview was like you can't look at a price of any product in isolation because it impacts another category. It could impact another category on the exact opposite side of the store. And there's no merchant that has the mental capacity to be able to handle that and compute that.

[Host]

Right.

[Chris]

So you're right. And so hopefully like you can take all those jobs out of the auspice of the merchant. Like I don't need to decide my pricing. Like that can be helped or I can just, you know, greenlight it, you know, essentially yes, I agree with that. You know, and manage by exception. And so that's the beauty here.

[Host]

Well, Wally, we have very high hopes for you. Don't let us down.

[Chris]

I keep thinking the moose when he punches the moose at Wally World, like Wally World's freaking closed or whatever. I don't know.

[Host]

See, I'm thinking about Wally the Robot. Like Wall E. Oh, Wall E. Yeah, that's where I was coming from. But it doesn't matter. Both great.

[Chris]

I thought of that too. I thought of that.