Facing the evolution of emerging consumer trends and the changes brought about by retail digitalization,WalmartThe pace of exploration has never stopped.

November 26-27,36The 2019 WISE New Economy King Conference was held at the Beijing International Conference Center. There were 13 venues, inviting more than 100 representatives of the new economy community to focus on the disruption and integration of new technologies and scenarios in traditional industries, connecting market participants such as startups, Internet giants, investment institutions, local governments, traditional enterprises, etc., and focusing on the growth and maturity of future industry kings who are down-to-earth and dream.

Chen Yishan, Vice President of Strategy and Business Transformation of Walmart China Investment Co., Ltd.

In the new era of online and offline retail integration, Walmart, as the world's number one retail giant, is also actively embracing the trend of new retail. As a benchmark enterprise in the retail industry, Walmart has always been committed to improving the quality of life of customers and the full integration of innovation and technology empowerment. It has carried out in-depth digital and intelligent retail strategies in various fields such as improving shopping experience, accurate marketing, and comprehensive payment services.

Meanwhile, in China, Walmart has also formulated a localization strategy and created Omega8, a platform that provides retail application scenarios and a global perspective, to address internal pain points in a timely manner. With “freshness,” “savings,” and “convenience” as the core, it uses cutting-edge technology to provide customers with a more user-friendly, selective and convenient shopping experience.

The following is a transcript of the guest's speech in English, edited by 36 Krypton:

Chen Yishan: Deeply involved in retail, there is no better time than now, and there is no better place than China. My name is Ella Chan, and I'm representing Walmart China at this event today. I am a VP of Walmart China, and I am mainly responsible for strategic and business transformation. Thank you so much for inviting 36krypton. I have the opportunity to share with you how Walmart innovates and accelerates the development and implementation of innovation in the retail industry.

First, why should Walmart China invest in innovation over the long term? Frankly speaking, as far as high technology is concerned, China has the best soil. This is not only reflected in the Chinese government's strong support for innovation, but also because Chinese innovative enterprises are gradually increasing their influence around the world, while at the same time dramatically increasing the appeal of the domestic market to outstanding talents. Together with Silicon Valley, Beijing and Shanghai have been ranked as the top ten science and innovation ecological cities in the world.

At Walmart, innovation has always been part of our (Walmart) DNA, and we have actively embraced innovation from beginning to end. In 60 years of development, Walmart has expanded more than 110,000 stores to 27 countries, including China. China, on the other hand, is one of Walmart's most promising markets for growth.

With the continuous investment of the Chinese government, enterprises, and investment institutions in innovation and the continuous updating and iteration of technology over the past 10 years, China's retail industry has changed dramatically. Probably ten years ago, people couldn't have imagined that the retail industry could operate in such varied models.

As we all know, both existing supermarkets and emerging competitors are constantly innovating and using new methods and channels to meet the needs of consumers. For example, e-commerce or online supermarkets. In just a few years, they have gone from nothing to occupy 20-30% of the retail market share. And in some segments, they account for even more.

The landscape and methods of competition in the retail industry are also rapidly changing. Global supermarket chains, domestic large and medium-sized supermarkets, and regional small supermarkets all compete fiercely in various fields; of course, a large amount of investment is pouring into the retail industry, exacerbating changes in this industry.

And for Walmart, how can we improve our competitiveness in this ever-changing market? Our core value has not changed since the beginning for 60 years, which is “saving money for customers, thereby improving their quality of life.” This value is simple and straightforward, yet it's so important. As Walmart's core value, it provides a code of conduct for Walmart's 2.3 million employees worldwide at all times.

Saving money for customers means Walmart needs to be more efficient. This is why Walmart has always been committed to collaborating with innovative companies around the world to actively explore and find innovative applications that can create value for us.

From a supply chain perspective, saving money for customers means more efficient transportation, storage, and management, and ultimately providing better value and service to customers. That's why we founded Omega8 in China, a platform rooted in China that provides innovative Chinese companies with retail application scenarios and a global perspective. We have rich retail experience and varied retail application scenarios, and China has cutting-edge technology applications. Through cooperation, we can use technology more quickly and accurately to empower Walmart.

So how exactly do we work? Actually, it's pretty simple. Because whether it's supply chain, store operations, or O2O, different departments always have different pain points, and we (Omega8) act as a bridge between startups and Walmart's internal core departments, promote effective communication and collaboration between startups and Walmart departments, and enable startups to more clearly understand Walmart's pain points, so they can quickly come up with and implement solutions to pain points. We (Omega8) have a systematic and efficient process for collaborating with startups.

That is, during the POC proof of concept phase, we only had a short 60 days. But we know very clearly what we need to verify within these 60 days and have specific milestones associated with it, so we can use the easiest method to verify whether a startup's innovative technology can work in the Walmart scenario.

After the proof of concept is completed, we will open up all systems so that the innovation can be applied in the most realistic scenarios and different stores, and finally promoted throughout the country. As we continue to succeed, as a global company, we will promote more innovations to Walmart around the world.

Also, how can we quickly and effectively integrate startups with Walmart's business unit? Every once in a while, Omega8 organizes a makerbank event. At the event, we will invite outstanding innovative companies and business experts from various Walmart departments to actually go to Walmart's different scenarios to understand Walmart's processes and systems. Innovative companies will have a full day to fully understand Walmart's major pain points. It's a day to learn from industry experiences, as well as a day to innovate and find solutions. Next, I'll share a few success stories.

Pioneering and innovating has always been part of Walmart's overall strategy. For a long time, Walmart has been dominated by large stores in China, so the supply chain built around this system handles products in whole boxes that have already been packaged. However, with the continuous changes in the Chinese market, the main consumers are gradually shifting to young consumers, mainly small families.

In order to meet the needs of new types of consumers, Walmart launched a new type of small to medium supermarket a few years ago. However, since medium-sized supermarkets require small or loose products, this puts considerable pressure on our supply chain management, because we need to add an additional link to reclassify bulky goods that were originally packaged into small portions.

For Walmart distribution centers that process tens of thousands of goods every day, the challenge of adding such a procedure is certainly enormous. This question was one of the pain points we raised during a makerbank event.

Ultimately, around this pain point, we collaborated with an innovative company to come up with a solution based on automated intelligent vehicles (AGVs). The system derives the optimal path based on the quantity and size of the goods in the warehouse and the storage environment, while AGV automatically delivers the goods that need to be subcontracted to the picker according to the optimized route.

This solution fits perfectly with Walmart's overall strategic direction, so the innovation was successfully implemented at Walmart within 3 months, increasing the efficiency of distribution packaging by nearly 200%. I think if everyone here has some understanding of the retail industry, then you know that a 200% increase in efficiency can definitely be called a huge success. It is because of the close collaboration between Walmart teams and innovative companies that we have been able to achieve such significant success in such a short period of time. Therefore, our future focus will definitely be to further strengthen cooperation with startups.

Another case is related to systems and data. In this era of the Internet of Everything, one of the most talked about topics is data and digitalization. Walmart's original supply chain management process involved a large number of reports and processes that needed to be filled out manually. Our ten or more dry warehouses deliver at a frequency of seven times a week to more than 400 stores nationwide. So you can imagine how much data needs to be recorded and stored in the process of receiving, sorting, and shipping, so Walmart spent a lot of labor to fill in and sort out reports in this area.

As before, after a detailed analysis of this pain point and the maturity of some technologies, the Omega8 team successfully found excellent science and innovation companies and solved Walmart's pain points together. This solution has been successfully used in Walmart's supply chain, and may be extended to other areas in the future.

Therefore, the focus of Omega8 is to understand the pain points of various departments within Walmart. After systematic analysis, it is determined which pain points are the most urgent and have the greatest impact on Walmart's customers, and then work with innovative companies to make the most suitable solutions for Walmart more quickly and effectively around these pain points, and implement the solutions quickly.

For innovative companies, lack of industry experience and a deep understanding of the scenario can also delay the speed at which their products are updated and iterated, thereby delaying the time for truly mature products to market. Omega8, on the other hand, can be said to be a small but beautiful platform. It (Omega8) combines the strengths of both of us very well, so that we can obtain a solution that can be implemented, verified, and meets the requirements of the scenario within a very short period of 60 days.

Although this speech is short, I hope that through this brief introduction, everyone present (innovative companies) can better understand how large, and possibly bloated, international companies view innovation, and how to collaborate and innovate with other large companies.

Overall, an attitude of embracing technology and active collaboration is a core element for us to innovate successfully. It is hoped that in the future, China's emerging technology will not only land in Walmart China, but will also be more likely to reach other Walmart markets around the world. Thank you all.