Wayfair Expands Google Cloud Partnership To Tap AI For Cost Cuts And Efficiency

Furniture and home goods retailer Wayfair Inc. W has deepened its partnership with Google Cloud to improve its operations.

The collaboration will use Google’s Gemini models on Vertex AI and integrate Google Workspace to boost employee efficiency.

The company has experienced positive results with tools such as Gmail, Google Docs, and Google Meet, where Gemini helps employees draft emails, edit documents, and design presentations.

The partnership seeks to optimize Wayfair’s product catalog as well. By incorporating generative AI, it is anticipated to generate cost reductions and boost operational efficiency.

“At Wayfair, we believe gen AI is the key to unlocking the next generation of retail experiences,” said Wayfair Chief Technology Officer Fiona Tan.

“With Google Cloud, we’ve been able to efficiently scale and enrich our product catalogs, enabling us to support a more seamless and engaging shopping experience for our customers.”

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To enhance its catalog management, Wayfair has adopted Gemini on Google Cloud to automate the process of categorizing products. With more than 30 million items in its portfolio, the technology has reduced the time required for product updates by 67%.

Furthermore, AI has lowered costs by removing the need for manual tagging and improved listing quality by identifying issues such as incorrect product dimensions.

In November, Wayfair reported third-quarter adjusted earnings per share of 22 cents, beating the street view of 13 cents and sales of $2.884 billion (down 2%) topped the analyst estimate of $2.876 billion.

As of September 30, active customers declined 2.7% to 21.7 million from the previous year, and orders decreased 6.1% to 9.3 million.

Also, last week, the retailer announced its exit from Germany due to challenges such as weak macroeconomic conditions, low brand awareness, and limited scale, affecting 730 employees.

Price Action: W shares traded lower by 2.95% at $42.80 premarket at last check Monday.

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