Consumers will soon be able to shop Walmart via ChatGPT. | Photo: Shutterstock
Consumers will soon be able to shop at Walmart by chatting with ChatGPT, the AI chatbot from OpenAI. That is a very big deal, for a multitude of reasons.
To get the basics out of the way: Walmart and OpenAI are partnering to make Walmart shoppable within ChatGPT. Users will be able to search for Walmart products and buy them without leaving the chat interface. The seamless process is made possible by Instant Checkout, the payments feature OpenAI unveiled in late September.
Needless to say, this news matters for more than just retailers. As restaurants know, technology used by places like Walmart typically makes its way to our industry at some point. In this case, it could happen very soon: DoorDash and Uber Eats are already set to integrate with ChatGPT for restaurant browsing, so it’s only a matter of time before the actual transactions will happen within the chatbot as well.
This is arguably the biggest restaurant tech development of the year for two reasons: It changes how people shop and potentially what they buy, and it introduces a powerful new player into the ecommerce landscape.
For about as long as online shopping has existed, the process has been more or less the same: A consumer enters what they’re looking for into Google or some other search engine, and they receive a list of responses.
With ChatGPT, the search bar is replaced with a conversation, which makes the search more dynamic and cooperative. For instance, consider how ChatGPT responds to the following query: “Halloween candy.”
It generates a list of popular candies, as well as links to a few options I can buy online. Overall, not all that much different from what you might expect if you typed the same thing into Google.
But it also asks for my budget, the number of trick-or-treaters I’m expecting, and my candy preferences, some of which I might not have even considered when making my initial query.
I respond that I’m expecting 100 trick-or-treaters and I’d like a candy that is free from common allergens.
It generates more information than I’ve ever wanted to know about allergy-friendly Halloween candies, as well as a “quantity estimate and mix plan” for 100 kids featuring a combo of different options (30 pieces of No Whey “No Fright Bites,” 40 pieces of YumEarth Giggles/Sour Littles, and so on and so forth).
It even takes a stab at estimating how many trick-or-treaters I can expect based on my general location, although I do not put much faith into its reasoning on that point specifically.
The only thing I couldn’t do (yet) was buy the candy right then and there. But that will be coming soon, as more businesses like Walmart adopt Instant Checkout.
Allergy-friendly candy suggested by ChatGPT, with links to buy.
It’s just one example, but you can already see how ChatGPT could make online shopping faster and less mentally taxing than it is today. It’s also clear how this process could be applied to a restaurant ordering experience that takes into account one’s location, food preferences, budget, group size, etc.
The biggest eye-opener is that ChatGPT essentially made my buying decisions for me by constructing a cart of different candies. I’ve never heard of a YumEarth Giggle before, but if ChatGPT says it meets my needs, why not? (What am I going to do, hand out apples?)
ChatGPT does the same thing when I ask it to suggest a restaurant for dinner tonight. It generates a list of local spots, but it also hand-picks two options that it especially recommends. That could be a decisive nudge for a diner who can’t make up their mind or is unfamiliar with the area.
The million-dollar question then becomes, how does ChatGPT decide which restaurants to surface, and which ones to recommend?
I wrote a bit last week about the murky logic behind AI-powered search results. A new and very detailed study found that restaurants’ websites and their third-party listings are the sources most often cited by AI—yet another reminder that operators would do well to keep those digital properties well-maintained.
OpenAI itself says that when a consumer asks ChatGPT a shopping question, the results are organic and unsponsored, “ranked purely on relevance to the user.” We’ll see how long the company can resist monetizing that, but as of right now, ChatGPT is a free-for-all.
Drilling down further, OpenAI says that a product’s “relevance” takes into account factors like availability, price, quality, whether a merchant is the primary seller, and, importantly, whether the business uses OpenAI’s Instant Checkout.
That last point means that businesses and restaurants that allow customers to buy directly within ChatGPT could be given some preference. Notably, businesses will pay ChatGPT “a small fee” on purchases made through Instant Checkout—introducing just another mouth for restaurants to feed in an already fragmented world of digital ordering.
This brings us to the next reason Walmart’s move is such a big deal: By inviting ChatGPT into the shopping experience, it is turning OpenAI into a sudden consumer data powerhouse.
According to the Wall Street Journal, Walmart will share access to purchase data with OpenAI on transactions processed in ChatGPT, a rare concession for a large retailer that typically prizes that data for marketing and advertising purposes.
On one hand, Walmart’s willingness to make that tradeoff shows just how much value it sees in partnering with ChatGPT. As the leading AI chatbot with about 800 million weekly users, it represents a huge source of potential sales for Walmart. Indeed, it could very well be the next Google of online shopping, making it a virtual requirement for Walmart to tap into.
On the other hand, it brings a new and somewhat unpredictable player into the ecommerce ecosystem. ChatGPT will undoubtedly use all of that Walmart data combined with its formidable blend of AI and personalization to shape consumer shopping behavior in ways that we probably haven’t even imagined yet.
None of this is exactly welcome news for restaurants, who are already struggling to keep their own customers and transaction data from being funneled to ordering giants like DoorDash and Uber Eats. With the Walmart partnership, ChatGPT is setting itself up to become yet another gatekeeper standing between restaurants and consumers.
At the same time, it’s not hard to see how ChatGPT could quickly make restaurant marketplaces like DoorDash obsolete. Why do I need to use ChatGPT to browse DoorDash when I could just have it suggest some restaurants and then place an order from the one I choose? The same question applies to the other players involved in the digital ordering chain: online ordering providers, order integrators, mobile app developers, reservation platforms, etc. are all at risk here.
It will be interesting to see which large restaurant chain will be the first to follow Walmart with a ChatGPT integration. Once the restaurant selection there reaches a critical mass, the chatbot could begin to take some business from the delivery apps. Eventually, it could even replace them as the preeminent online restaurant marketplace.
To be clear, this transformation is still in its very early stages. We have a lot more questions than answers. But if things keep heading in this direction, OpenAI could change everything we know about how restaurants do business in the digital age.
