In a bid to compete with Amazon, Kroger teams with Microsoft on a connected store pilot program

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In 2018 it was reported that Microsoft had entered into a partnership with Walmart, arguably one of the largest retail chains in the US.

The partnership between Microsoft and Walmart is designed to help move Walmart’s digital communications and operations onto Microsoft’s Azure platform and services while offering Microsoft the opportunity to test the scalability of its cloud platform.

The Walmart and Microsoft partnership arguably also signifies the need of Microsoft’s modernization tools for two to keep pace with the rapidly evolving retail changes put forth by Amazon and Google.

As of January 7, 2019, Microsoft will once again be testing the elasticity of its Azure cloud as it partners with Kroger, America’s largest grocery retailer and global technology company on two new pilot connected experiences.

In a press release provided by Microsoft, the company details the nature of the new Kroger partnership as well as some of the desired outcomes.

Transformative customer experiences
By using Microsoft Azure to store and process the data generated in stores, near the smart shelves and on Kroger’s app, the digital stores will introduce never-before-seen shopping experiences, including the latest generation of EDGE™ Shelf (Enhanced Display for Grocery Environment), a shelving system that uses digital displays, instead of traditional paper tags, to indicate everything from prices and promotions to nutritional and dietary information. Using Microsoft Azure AI, EDGE Shelf will connect with Kroger’s Scan, Bag, Go®, creating a unique guided shopping experience for customers.

Greater employee insight and productivity
For store associates, a pick-to-light productivity solution can reduce the time it takes to fulfill curbside pickup orders by using visual cues to help them quickly find items. Additionally, solutions like Microsoft Azure-powered video analytics will help store associates identify and address out-of-stocks to ensure customers can locate products on their shopping list.

Similar to its Walmart partnership, Microsoft is aiming to help Kroger redefine the shopping experience by providing the company with transformative big data analysis as well as marketable product for other retail businesses called Retail as a Service.

RaaS is a commercial product that was created through this partnership with Kroger and powered by Microsoft Azure, which intends to provide a suite of capabilities that focus and support specific business KPIs, collection of customer insights, hyper-personalization, employee productivity and improve out of stocks, all with the intention to provide a better customer experience.

Microsoft and Kroger are pitching the new RaaS as “enablement software built by a retailer for retailers,” and the two have plans to expand the current offering to someday include: Scan, Bag, Go, Virtual Store Manager, sensor network, point of Sale, and inventory management systems.

The first RaaS service on the market today is Edge Shelf which allowed Kroger to generate additional revenue through digital advertising to consumers on packaged goods (CPG) brands. Specifically, with the use of video analytics Kroger was able to produce personalized offers and ads to specific customer demographics.

Edge Shelf is being offered as a pilot program to select retail business with expansion plans throughout “2019 and beyond.”