Walmart tests in-store location service via smartphone app

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SAN FRANCISCO--Walmart is testing a technology that will allow smartphone users to search for specific items in a store and find their exact location in that store. The company is testing the service in its San Jose, Calif., store, said Gibu Thomas, SVP of mobile and digital at Walmart.

In comments here at the Open Mobile Summit, Thomas said Walmart is working to use its smartphone app to improve its customers' shopping experience. Along those lines, Thomas said the pilot service allows shoppers in the San Jose store to open the Walmart app on their smartphone, search for a specific item like toothpicks and, if the item is in the store, to see where it is on a map of the store's layout.

"All this information is already available, it's just in some store system that was never intended to have a customer access it," said Thomas.

Walmart spokesperson Ravi Jariwala said that the test in San Jose "is one of many tests we're conducting. Because it's a test, we really don't have any additional details to share beyond what Gibu mentioned."

In his comments, Thomas also offered a glimpse into Walmart's strategic thinking on smartphones and mobile payments. He said the retailer--the world's largest--doesn't see much value in Near Field Communications payments. He said Walmart's customers don't need to use their phone to pay for products--they already have cash and credit cards for that. Instead, he said that Walmart wants to use its mobile offerings to help its customers shop more effectively. For example, he said Walmart's app allows users to create a shopping list within an established budget.

Walmart is also reportedly testing a service that would allow shoppers to scan items using their Apple (NASDAQ:AAPL) iPhone and complete their purchase at a self-checkout counter. Thomas didn't mention those reports during his appearance here.

Thomas was questioned though about Walmart's position on mobile payment services like Google (NASDAQ:GOOG) Wallet and Isis, the point-of-sale initiative spearheaded by Verizon Wireless (NYSE:VZ), AT&T (NYSE:T) and T-Mobile USA. He said that Walmart doesn't want to have a middleman between its sales and its customers.

"If you're adding more mouths to feed, the cost per transaction goes up," he said, adding that retailers need to be "in control of our own destiny."

Thomas did say though that Walmart is watching the moblie payments space closely and could enter the market in some form. Along those lines, Walmart is a member of the Merchant Customer Exchange (MCX), which was created by Walmart, Target, Best Buy and Sears with 7-Eleven, Alon Brands, CVS Pharmacy, Darden Restaurants, HMSHost, Hy-Vee, Lowe's, Publix Super Markets, Shell Oil and Sunoco. Thomas did not mention MCX in his comments here.

Finally, Thomas said that smartphones could become a big part of Walmart's business. He said research by the company showed that around 50 percent of Walmart shoppers own a smartphone, and Thomas said that use of the company's mobile offerings is growing "dramatically."

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Article updated Nov. 9 to clarify Walmart's position on mobile payments.

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