Inside Walmart's Super Social Shopping Agenda, Or Keeping Up With The Digital Joneses

Take a deeper look at how Walmart plans to leverage the social data and connections of its massive customer base through its @WalmartLabs.

Walmart

Don’t know what to get your co-worker this Christmas? If all goes well at @WalmartLabs, Walmart may be able to suggest exactly what you and he and the neighbors and friends you both share are into. @WalmartLabs, launched recently to power the e-commerce push of one of America’s biggest retailers, is working on milking information from its own customers' social networks to reshape the future of shopping.

Customer information on networks like Twitter and Facebook offers a rich opportunity for retailers like Walmart to learn about shoppers’ interests--and those of their friends. Armed with that information, they can more reliably target deals and choices at customers--if they have the know-how to navigate that stream of data.

That's where @WalmartLabs comes in. Before it was part of Sam's Club, it was a tech startup in Silicon Valley (then called Kosmix) founded by entrepreneur-engineers Venky Harinarayan and Anand Rajaraman. The two are creating something they call the "social genome" (not unlike Mark Zuckerberg's social graph), which tracks links between people and their interests. On a scale like Walmart’s, it has the power to change the future of shopping.

At the heart of the technology powering @WalmartLabs is categorization of social media, Harinarayan explains: "How to put things in buckets, rather than looking for needles in a haystack." Kosmix's early product, TweetBeat, sifted through real-time traffic on Twitter to offer up a curated, pertinent stream of information which users could tap into to follow a live event. The company also built RightHealth, a search site for health information, powered by the same technology.

@WalmartLabs will be heading up Walmart's foray into social retail in three different ways. First, using technology similar to the kind they developed for TweetBeat, @WalmartLabs will help track the interests of people living around a Walmart store, and use that information to drive inventory. For example, people living near a Walmart store in Mountain View, CA, may tweet about biking, while people living somewhere else may be tweeting about fishing. Using their custom technology that organizes and filters social media feeds, @WalmartLabs will play a key role in advising in-store inventory, using social media as a way to predict demand.

Walmart also wants to talk to you on your social network of choice. Using their knowledge of interests and your friends networks, the store wants to be able to make gift recommendations for your friends through Facebook, Harinarayan says, like offering deals around the holiday season. The first of these are expected to be rolling out by the end of this year.

The store also wants to use social media to enhance customers' experience when they hit the store on foot. Thirty percent of Walmart's customers carry smartphones into stores, and Walmart sees an opportunity to enhance their shopping experience with that device. "With mobile, we're bringing the web to the store--one of the big components of that is the social world," Gibu Thomas, senior vice president of mobile and digital units at Walmart, tells Fast Company. Thomas says another of Walmart’s goals will be to get a combination of social media data harvesting and mobile app building to enhance a store visitor’s shopping experience. When a person is standing in front of the electronics display pondering which television they’d buy, their smartphone could tell them what brands their friends bought, and perhaps even how much they liked the product.

Walmart has been lagging in the online retail space, behind competitors like Amazon.com, and it's interesting that the retailer is not using this venture to particularly boost its activities online. By focusing instead on mobile integration, social network data mining, and enriching their customers' in-store experience, it's possible Walmart will make hefty inroads into shopping on social media, leaping ahead of its competitors while its customers keep up with each other.

Nidhi Subbaraman writes about how technology is changing our world. Follow on Twitter, Google+

[Image: Flickr user code poet]

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2 Comments

  • Zac Stuckey

    In paragraph 7, you mention that 30% of Walmart shoppers are carrying smartphones into the store. Where did this statistic derive? I only ask because it seems about double what it probably is. Any insight? Thanks!

  • Bill Bishop

    It's amazing to see the vision for how WalmartLabs will give the retailer a way to tap into the power of its' own customer social networks to reshape their shopping experience.  We probably would have anticipated that Walmart would be using mobile to enhance the in-store shopping experience, but what was particularly interesting and new for me was the idea of tracking the interests of shoppers around their stores to better guide assortment and merchandising decisions.  I can only wonder if they will be tapping the power of new analytical systems to combine this social media input with POS and search data to even better inform their local merchandising and marketing decisions.