Dive Brief:

• Wal-Mart Stores Inc. is merging its information systems division with its technology innovation group to create a new unit called Walmart Technology, Reuters reports. 

• The information systems division, which focuses on computer technology in stores and is now based out of the retailer's Bentonville, AR-based headquarters, will merge with Silicon Valley-based Walmart Labs.

• While Wal-Mart is known for its tech innovation in supply chain management going back several decades, the rise of e-commerce and pressure from Amazon has left it playing catch-up online. 

Dive Insight:

In a bid to catch up to Amazon, Wal-Mart has been busy in recent years acquiring tech startups. The company plans to spend some $2 billion for its e-commerce overhaul, considerably more than the $1 billion it says it will need to better pay and train its store staff.

The retailer has introduced omnichannel initiatives like in-store pickup, but experts have told Retail Dive that much of its omnichannel efforts might help more to drive sales in brick-and-mortar stores than online.

Wal-Mart is hardly alone among retailers having a presence is Silicon Valley, presumably to take advantage of the innovation and expertise there. The retailer first moved into the area in 2011, and now has tech centers in San Bruno and Sunnyvale.

The retailer’s technology investments haven’t done much to move the needle so far, but as Amazon has showed the industry, it can take time for innovation to pay off. The retailer’s e-commerce growth was 10% during Q3, slower than previous reports, and well below Amazon’s 23% clip.