Dive Brief:

• Walmart has opened new test stores aimed at quickly experimenting with omnichannel technology and processes.
• The stores currently are focused on blending online and in-store inventory, accelerating inventory movement from backroom to sales floor, speeding up in-store pick rates for online orders, and experimental checkout technologies.
• Walmart has two test stores up and running with two more set to open, according to a blog post from John Crecelius, senior vice president for associate product and next generation stores at Walmart U.S.

Dive Insight:

As Walmart keeps trying to grow its digital business, it's leaning on a major advantage it has over Amazon and online pure players: its vast base of large stores.

"We have an amazing set of assets that have us well prepared for this next era, but we can't stop there," Crecelius said in the post. "We're moving quickly to use our physical retail stores to not only serve in-store shoppers, but to flex to meet the needs of online shoppers, too, in ways that only Walmart can."

Of the test stores specifically, Crecelius added, "Their purpose is to find solutions that help our stores operate as both physical shopping destinations and online fulfillment centers in a way that has yet to be seen across the retail industry."

To that end, Walmart is looking to rapidly test technology at the prototype stores, often with a mind toward operational efficiency as stores become both shopping destinations and fulfillment and pickup centers for digital orders.

The retailer, for example, is rolling out an app for employees that uses augmented reality to identify boxes ready to go to the sales floor rather than having associates scan each box individually.

Walmart is also testing ways to combine in-store signage with handheld devices to help workers get to the right location to pick online orders. Crecelius said methods tested so far have boosted by 20% how often store associates find an item on their first attempt. "What this means for customers is that their orders get filled faster."

Other tests include blending in-store and online inventory categories, such as apparel, and contactless checkout technologies.

The test stores are just the latest in Walmart's efforts to marry digital with in-store shopping. This fall, the retailer announced it planned to revamp some 1,000 stores with a new format that encourages customers to use Walmart's app while shopping and provide contactless checkout options.

This year, Walmart fully merged its e-commerce and store buying teams into a single merchandising organization to help smooth out friction and streamline its purchasing operations. Along with simplifying buying and improving communication with vendors, the move was meant to help make Walmart's online assortment better reflect what's in stores.

The new test stores are working to that end, as well, by moving the in-store apparel assortment online. The goal is to learn "what it takes to make all eligible items in the store truly omni– available for customers online and in the store," Crecelius said.