(This article was originally written by Daphne Howland for Retail Dive).
Wal-Mart Stores Inc. is apparently developing a technology in a challenge to Amazon’s Dash button consumer goods replenishment program, according to a patent application unearthed by CB Insights.
The application was first filed last October and describes an Internet of Things (IoT) platform that tracks consumer products used in homes — including how often, when and where an item is used — and automatically orders when products are depleted or need replacement, according to the report.
While similar to Dash, the system removes friction even further with its automation, which does not require pushing a button, according to CB Insights.
Amazon’s Dash replenishment effort does allow device manufacturer partners to integrate Dash technology into their products to enable automatic supply reordering. For example, GE Appliances' WiFi-connected dishwasher measures how many pods are used by counting wash cycles, and when the supply runs low, it automatically reorders more.
But the program is mostly a collection of buttons (physical and virtual) that shoppers tap when they want to order more of a product, including, as of last month, apparel. Amazon first launched the Dash automated commerce program in March 2015, prompting speculation that it was an April Fool's joke. Though it had a slow start, it now seems clear that Amazon's innovation has tapped into a consumer need: Fortune estimates that Dash brings in some 5,760 orders each day.
Last year, Amazon said that orders surged 75% in the first quarter, though such high percentages are expected when still in the early stages. In July last year, the program saw a 650% increase in the number of orders year over year, according to data from Slice Intelligence. Amazon said earlier this year that success is what prompted the development of the virtual version, adding that it was not related to the pending expiration of Amazon’s patent for one-click purchases.
One key to Dash’s growth — and one of the biggest keys to Amazon's entire corporate success story — is volume. Adding more products and more brands to give customers choice is one of the cornerstones of growth for any retailer.
Then there's convenience, another pillar of retail success. Thanks to the digital versions, Dash buttons are no longer limited to customers who ask for them (and go through the process of deciding to try them, ponying up the refundable $5 and actually using them). To make it even easier to access and manage, Amazon is providing an “Add to your Dash buttons” notice on the page of any eligible product.
Wal-Mart appears to be going after similar ground, though it's unclear how much consumers would appreciate the major incursion into their homes or the platform's emphasis on automatic orders described by CB Insights. Wal-Mart has been gunning for Amazon of late, bulking up its assortment through deals with vendors and the acquisition of several online retailers, including women’s apparel company Modcloth, outdoor retailer Moosejaw, footwear site Shoebuy and soon reportedly menswear site Bonobos, not to mention last year's $3.3 billion acquisition of upstart e-commerce site Jet.com.
Still, Wal-Mart has far to go in that catch-up game, Jet founder and new Wal-Mart U.S. e-commerce chief Marc Lore said at the Bloomberg Breakaway Summit this week.