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Why Wal-Mart Is Going Social Media

  |  August 1, 2007   |  Comments

How consumer-generated media can boost commerce.

Bazaarvoice added WalMart.com to its roster of clients seeking tap the power of the collective. This came about as a result of the retailer simply asking, "How did we do?"

Wal-Mart, perhaps as part of its image resuscitation effort, is turning to its online customers in a quantifiable, open way to ask what they want. After all, founder Sam Walton always said, "If you have questions, go to the store. The customer has the answer."

People are being given the ability to express themselves in new ways that go beyond consumer necessities. Passions, viewpoints, lifestyle preferences, and things found to be funny are all in circulation now at a personal, rather than centrally programmed, level.

In the recent Democratic television debate, YouTube played a role as a channel for information flowing into the debate. Ordinary people were given the opportunity to supplant professional journalists. The result was a perhaps not-so-surprisingly good show. Larry Sabato, director of the University of Virginia's Center for Politics, summed it up by saying, "It was a turning point in a sense. It's an innovation, and it involved the public and especially young people, and that's all to the good. I heard some very silly questions; I heard some very good questions. In other words, it's just like a debate where the journalists ask the questions."

In a larger sense, the YouTube-powered debates were yet more proof that ordinary people really do have something to say and that when empowered they can say it effectively. A recent eMarketer study supports this. There are currently about 64 million generators of user-generated content, about 10 percent less than the 69 million users of user-generated content. By 2011, this gap will close to about 5 percent: 95 million generators versus 101 million users. In other words, generators and users are nearly equal in number, an amazing fact when you consider the initial imbalance in the early blogosphere: something in the range of 3 to 10 times as many users as generators. Better tools, specifically tools that are easier to use or are just more fun, are really having an effect.

The Bazaarvoice team has long understood this and tapped the power of quantitatively describing consumer behavior around commerce events. Understanding not just who bought what, but who told them to and why (or why not) is critical to building a business in a culture where people are fundamentally connected, even when this sense of connectedness isn't apparent.

Say you ask a friend who enjoys sports which sunglasses she likes. This particular person has direct social standing (you know what she knows and what she doesn't, and how this all relates to you) as well as direct knowledge of the types of products that work well in the application you're considering (domain expertise). In online distributed networks, we must sort this out for ourselves. Newer networks and tools actually allow us to this. As a result, our access to the experiences of people we'd not otherwise connect with now informs day-to-day processes in a way that's almost transparent. That's great when we're buying things, because we need information to make smart choices.

But what about when we're not buying things? What happens when we're just talking, sharing ideas? As marketers, we recognize the need to influence potential sales somewhere between "Wouldn't it be great if someone made..." and "OK, now all I need to do is decide between the red one and the blue one."

The newest video platforms are starting to push into this area. Where YouTube is still pretty much one-way ("I post, you watch"), platforms like Eyespot, Jumpcut (now part of Yahoo!), and Snapse are aimed at giving people who would normally watch the opportunity to actually do. Snapse pushes the concept beyond small bits of Flash video by allowing on-the-fly remixing of streaming content, opening up this emerging fascination to longer and more collaborative forms of expression. (Disclosure: I'm associated with Snapse.) All these remixing platforms extend the reach of ordinary people, who at some point and in some setting will invariably become consumers for your product or service, making easier the task of sharing ideas, aspirations, humor, and ultimately culture.

Look again at Wal-Mart and its implementation of Bazaarvoice's platform. Improving business processes gets a solid boost when immediate, quantitative feedback systems are put in place that facilitate information sharing between consumers and with Walmart.com's marketing and operations groups. New participative video platforms likewise give people the ability to easily collaborate and share thoughts, ideals, and more. Like feedback platforms, these tools can be put to use by marketers as well, not just as ad platforms but as content plays, further closing the loop between purchase consideration and active referral. Regardless of what your firm makes or sells, in a word-of-mouth-driven world, closing that loop is fundamental to business success.

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ABOUT THE AUTHOR

Dave Evans

Dave is the VP of social strategy at Lithium. Based in Austin, Dave is also the author of best-selling "Social Media Marketing: An Hour a Day," as well as "Social Media Marketing: The Next Generation of Business Engagement." Dave is a regular columnist for ClickZ, a frequent keynoter, and leads social technology and measurement workshops with the American Marketing Association as well as Social Media Executive Seminars, a C-level business training provider.

Dave has worked in social technology consulting and development around the world: with India's Publicis|2020media and its clients including the Bengaluru International Airport, Intel, Dell, United Brands, and Pepsico and with Austin's FG SQUARED and GSD&M| IdeaCity and clients including PGi, Southwest Airlines, AARP, Wal-Mart, and the PGA TOUR. Dave serves on the advisory boards for social technology startups including Palo Alto-based Friend2Friend and Mountain View-based Netbase and iGoals.

Prior, Dave was a co-founder of social customer care technology provider Social Dynamx, a product manager with Progressive Insurance, and a systems analyst with NASA| Jet Propulsion Labs. Dave co-founded Digital Voodoo, a web technology consultancy, in 1994. Dave holds a BS in physics and mathematics from the State University of New York/ Brockport and has served on the Advisory Board for ad:tech and the Measurement and Metrics Council with WOMMA.

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