Wednesday, April 20, 2011

When in doubt, follow your customers

An old saying in the newspaper ad game was "follow your customers". That advice used to mean that if you wanted to increase business it might be wise to start attending the Chamber of Commerce meetings. In one ad manager position I learned that there was no local auto deal association so I started my own, that way the dealers would be coming to my own meetings.

The same advice holds true when trying to figure out what the heck Walmart is up to buying a social media platform for $300 million.
The company, Kosmix, will join forces with @WalmartLabs to work on the retailers social and mobile commerce strategy. The acquisition, along with the founding of @WalmartLabs suddenly gives the Arkansas-based retailer a more Silicon Valley orientation, a development that probably has a few people shaking their heads in amazement.

"We are at an inflection point in the development of ecommerce," co-founder Anand Rajaraman writes on the Kosmix blog page. "The first generation of ecommerce was about bringing the store to the web. The next generation will be about building integrated experiences that leverage the store, the web, and mobile, with social identity being the glue that binds the experience."

"Social networking and mobile applications are increasingly becoming a part of our customers' day-to-day lives globally, influencing how they think about shopping, both online and in retail stores," Eduardo Castro-Wright, Walmart's vice chairman said in Walmart's announcement. "We are excited to have the Kosmix team join us to accelerate the development of our social and mobile commerce offerings."

When learning about a move such as this one it is typical to wonder "what the heck are they up to?" But a better reaction from media executives would be "where are they going, and are we going there, too?"