The Blind Spot In The Walmart-Google Partnership Against Amazon

It's easy to see why some observers of the recent Walmart-Google team-up would see this as a huge equalizer in both companies' efforts to stay competitive with Amazon. But that's probably the last thing it'll do.

If Walmart truly wants to gain ground on Amazon, it'll need to lead by improving its customer experience strategy rather than piggybacking on Google technology in exchange for precious customer data. In doing so, Walmart has a pretty huge blind spot in its logic for the deal that comes down to digital contribution — or the contribution each portion of the customer's journey that contributes to the overall sale. Below are a few insights showing why this is more likely to boost Google than help Walmart compete against Amazon ...

The path to the register

Our research on the retail customer experience reveals half (49%) of customers that visit a store location have had some kind of digital interaction with that retail brand. Customers who are satisfied with their experience are 85% more likely to visit a store from the same brand the time they shop – and 75% said they're likely to use another channel from the retailer in the future.



Now think about this from the perspective of Walmart's new partnership, which will allow consumers to link their Walmart accounts to purchase items via Google Express and eventually through Google's Home smart speaker using voice controls. These seem pretty convenient for Walmart customers, especially those who find Amazon's search tool useful when researching a product or simple when ordering using devices that utilize Amazon's Alexa voice assistant. But Walmart doesn't control those experiences, so it's leaving it up to Google to make sure that happens.

And perhaps more importantly, this is the first time Walmart is allowing consumers to make purchases through their retail business from outside online sources. So if a large number of shoppers who have a satisfying experience via Google are more likely to use that channel again in the future, then Walmart gets left in the dark. And Google's service also features many other retailers, who may now benefit from comparing items, thus cutting Walmart out entirely. 

So even if it leads to revenue gains in the short-term for Walmart, it's basically making the gamble that its customers will remain loyal — which is hard to verify because the retailer isn't focused on measuring for digital contribution. 

Click-and-collect and digital contribution blindness

There's only so much Walmart can find out about the experience its customers are having making purchases through Google (but plenty that Google can learn, which is another story altogether). While it might be more convenient to shoppers to find their items using a journey that goes outside of the company's ecosystem, Walmart is limited in knowing how it affected the overall experience. And adding Google to the mix means it's blind on customers that browse its items online (outside of Walmart's website) without making a purchase.

But that raises a good point: Stop to consider what happens when a customer visits a retailer's digital channel, but doesn't make a purchase. Normally, these instances fall through the cracks, but it could be that retailers are assuming that the journey for a potential customer just ended, which is a dangerous assumption to make. Case in point: 41% of people that leave a digital channel without purchasing said they plan to visit a store location next, versus 28% who said they plan to visit a competitor's website, according to our research.

Now, without being able to gain customer experience data about the journey that falls outside of a retailer like Walmart's environment, you're essentially only measuring and producing insights with a fraction of the overall customer journey. You don't even know that they did research online prior to coming in. Perhaps they didn't realize that there were additional fulfillment options when making a purchase.

U.S. consumers have embraced the "Buy Online, Pickup In-Store" journey option, and it's very popular among Walmart customers. The reasons customers may prefer this option over having an item purchased online and shipped to their home are varied, but one common explanation is that they want the merchandise immediately rather than having to wait two days (or longer) for delivery. 

Does research done by Walmart customers via Google Express lead them to making a visit to the store if they don't make a purchase online? Or are they among the 23% of people who would go to a competitor's website upon leaving without making a purchase? And since Google Express offers items from Walmart competitors, are people staying on Google's site and buying items from those rivals?

In conclusion: Walmart and a Google Express blindfold

The point is, you can't know what you don't know. And Walmart's critical flaw in this Google Express partnership is that, by giving up a greater stake of the digital portion of the customer journey, it is creating a bigger blind spot into how to keep its customers satisfied and loyal.

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