Imagine you place a grocery order for delivery, asking for almond milk, a dozen oranges, and a can of tuna fish. The service fulfilling your order has bad luck though, and all of those items are out of stock, so it decides to substitute. It picks up coconut milk, a dozen tangerines, and a can of tuna-flavored cat food. If you’re like most customers, you might accept the milk and citrus fruit, but cat food isn’t going to fly—especially if you don’t have a cat. The example might seem absurd, but similarly unacceptable replacement items have been shared frequently by posters who join social media groups with names like, “That’s It: I’m Grocery Substitute Shaming.” But finding a good resolution to in-store stockouts is particularly challenging for the hired shoppers choosing items for clients rather than for themselves; you know whether you’d rather substitute the almond milk with soy, whereas a worker employed by the store or a delivery service can only guess, limited by their own cognitive biases and limitations. That’s where technology comes in: Walmart has been working with a new artificial intelligence (AI) tool that can gather massive amounts of data about which kinds of substitutions cause customers to complain, as well as which ones appear acceptable. According to early reports, the substitutions chosen by the AI—on the basis of hundreds of variables, such as brand, price, size, prior consumer choices, and inventory levels—have increased customer acceptance of the substitutions by 95 percent. Because the technology can include more decision factors, it can produce a more satisfactory resolution to a stockout problem, then continue learning from each customer’s reaction to each substitution to improve its performance the next time. It might be AI to the rescue, keeping kids from finding a tuna fish cat food sandwich in their lunches.

Source: Tom Ryan, “Can AI Solve E-Grocery’s Erratic Out-of-Stock Substitutions?” Retail Wire, June 28, 2021; Mark Price, “Popular Online Grocery Services Often Include Hilarious Substitutions During the Pandemic,” Miami Herald, May 20, 2020