How Your Social Data Will Power Walmart’s E-Commerce Revolution

From Tech Crunch:

Walmart is planning to launch several new projects this holiday season based on the technology it acquired from the social media startup Kosmix back in April. Kosmix’s platform previously powered several services, including a Twitter search site called TweetBeat, a health vertical called RightHealth and a homepage where users could search the Web by topic. But the core of what Kosmix was building was something called the “social genome” – a way to organize the content in social networks in order to connect people with the information that mattered to them.

Now, that same technology is in the hands of Walmart, the world’s largest retailer.

These days, Walmart.com does around $6 billion per year in sales vs. Amazon.com’s $34 billion, according to analysts. ”Walmart had fallen behind in e-commerce,” says Anand Rajaraman, Kosmix Co-Founder now SVP of Walmart’s Global e-Commerce division, “and the board realized the issue was serious.”

Something had to change.

Although Rajaraman wouldn’t go into detail about the handful of projects Walmart has planned, it’s easy to read between the lines at guess at their nature – social search on Walmart.com, personalized alerts on rollbacks sent to email or mobile, Facebook-enabled social wish lists or gifting applications, and who knows what else may come in the future.

In April, when Walmart acquired Kosmix, it had already raised $55 million in funding from a number of investors throughout the years. What made Kosmix appealing was not just the technology itself, but also the people behind the technology: founders Venky Harinarayan and Anand Rajaraman, successful e-commerce pioneers who had sold their previous company, Junglee, to Amazon. At Amazon, they worked with CEO Jeff Bezos to transform Amazon into a retail platform, and invented the technology that now powers Mechanical Turk.

When Kosmix was acquired, it became the nucleus of a new group at Walmart known as @Walmart Labs, based in Silicon Valley. At WalmartLabs, the founders have been busy developing projects which will integrate the Kosmix technology into Walmart’s online and mobile offerings, including its e-commerce website, Facebook pages and more. There are three main areas of focus for the team: search, recommendations and serendipity.

Social Search and Recommendations

In search, Kosmix’s technology will pull data from Facebook and Twitter to improve your search experience on Walmart.com. By monitoring your ever-changing interests on topics like your favorite sports team or band, for example, Walmart will be able to serve better recommendations when you search its site. It might work this way: you search for a new smartphone, and Walmart recommends one you friend just liked on Facebook .

Walmart plans to leverage your social data outside of search, too. It plans to directly recommend products on its homepage. At Amazon, explains Rajaraman, there’s too much emphasis placed on your purchases for recommendations. “Purchases are a window into your interests,” he says “but they’re a small window.” Anyone who has ever purchased a gift at Amazon only to be suggested similar items upon every subsequent login knows the problem. Instead of recommending more travel guides for Paris, long after your trip was complete, or more power tools, long after Dad’s birthday has passed, Walmart plans to recommend things it actually knows you like. Whether or not it can succeed where so many others have failed will soon be put to the test.

And these tools can be used to analyze your friends’ behavior, too, in order to offer wish list suggestions based on their interests. Assuming they get it done, the way Walmart is leveraging Twitter and Facebook here could be an industry first.

Personalized Alerts

If that sort of deep dive into your personal preferences sounds creepy, well, at least this is an opt-in system. Rajaraman says Walmart will never use consumers’ data in any way beyond what it has permission for, and your’e in control of that. But he thinks consumers will be willing to share there information in return for tangible benefits. Benefits, like discounts? While Walmart has no plans introduce huge discounts like Groupon offers (it’s happy to provide “everyday low prices,” says Rajaraman), it will be able to personalize alerts on items it puts on “rollback,” its own system for promoting sale items.

Instead of spamming you with notifications, Kosmix’s technology will be able to identify what sort of rollbacks you, as an individual, would like. This is what he means by “serendipity” – alerts that will surprise and delight consumers.

You may even be able to one day receive in-store notifications as you pass by items of interest that match those pulled from the Kosmix system. As for what technology would be used on the mobile side, Rajaraman couldn’t say. But the company is experimenting with several approaches for providing mobile services, including things like NFC (near field communication), barcode scanning and in-store geo-fencing. However, these fall outside of the @WalmartLabs team’s domain – they’re more focused on the data.

The first projects built on top of Kosmix’s technology will launch this holiday season.

Bloggers Are Promotional Partners, Which Is Bad For PR

From Social Media Explorer:

I’ve been ranting for some time about the disconnect between PR and social media, and particularly between PR and blogger outreach. In the evolution of social media, somehow blogger outreach became equated with public relations’ pitching to journalists, and so for years it’s been largely the domain of PR coordinators and account executives.

That’s seems wrong. I feel that PR should not be primarily responsible for blogger outreach. And likely not for other types of social media either.

I know, PR people, you disagree. You know how to do relationships, and you believe that social media is about relationships. You are communicators, and social media is communication. You diligently polish and protect brand reputations, and you can do the same in social media. I get all that and I’m not for a minute discounting all the hard work you do in all of the above.

Here’s the problem: Bloggers are not journalists. Blogger outreach programs are, most often, not earned media. Blogger outreach programs are actually paid media (even when no money exchanges hands). And therein lies the rub.

Where does the “paid” come from? Well, first of all, I am certainly not advocating for a blogger to get paid to write a product review. That seems wholly unethical and, as with any type of product review such as that which might appear in a magazine, is payola at its worst (though it does happen). However, with the exception of product reviews, everything else a blogger does to assist a brand in promoting a product or service is a promotional partnership. That’s right, bloggers are promoting, and therefore should be partners. Paid partners. Or fairly compensated in some other way (barter, donations, travel, whatever makes sense to both parties). And not only in product.

[But wait!, you say. Many bloggers are blogging for entirely personal reasons, and they don't want to nor expect to get paid. You are correct - I know of plenty of bloggers who blog about their kids, their travels, their hobbies or their industry and none of them would ever think to take payment from someone to promote a product. My question then is why is a PR person pitching them to promote a product (and especially if that product isn't a 110% perfect fit for their audience) in their personal blog? I'd be pissed if I were such a blogger and was inundated by requests from PR people. And it most certainly does happen, all the time. Pitching bloggers appropriately is another topic I rant about a lot.]

So here’s the disconnect: Marketing budgets put the most money into media. Huge percentages of budgets are devoted to paid media. And PR firms rarely get OOPs (out-of-pocket) budgets beyond events, spokespeople or day-to-day operational costs. So when PR people go to the blogger and ask for them to help promote a product, and the savvy and deserving blogger replies with his or her standard charge for that type of promotional partnership, the PR firm has to say no, because they usually don’t have the budget for it.

That’s right: PR firms (most of them, anyway) do not have the budgets to do effective blogger outreach. They don’t typically know how to budget for it, how to ask for the budgets, and they’re not set up to pay bloggers effectively even if they have the budget. That’s why it’s not working, and why it won’t work, unless there’s a huge mind shift on both the client side and the agency side, and soon.

One tragedy of this dynamic, which has been playing out for a few years now, has led to the perception of bloggers (and particularly “mommy bloggers,” who should henceforth be referred to as parenting/lifestyle bloggers) as always having their hands out. And it’s also led to the recent tsunami of new bloggers who have entered the space just hoping to make money, without necessarily having a true passion for the craft. And when you’re a new blogger with a dozen readers, most of which are your book club, you don’t deserve to be a paid promotional partner for a blog. Grow your readership, and establish your value, before you stick your hand out. So yes, recently it’s become a bit difficult to listen to all those bloggers who are whining about wanting to get paid, because many of them should not be paid.

But when a blogger becomes the media, when they are publishers who create informative, entertaining, touching or important content that reaches thousands or millions, they have power. And that power can and should be harnessed by brands in a professional way. By professional, I mean paid.

So PR firms, if you haven’t figured this out yet, here’s what you must do: you must convince your clients to give some of their media budget to you. To do that, you have to learn to budget differently, and then you must learn to manage it (because those media-like payments will turn your accounting department on its ear). Then, with those budgets, you must create smart and clever (and measurable – but that’s a topic for another post) promotional partnerships with bloggers. Because if you cannot, you will not be able to effectively play in the field of blogger outreach. And the digital agencies are going to eat your lunch.

Disney Marketing: The Happiest Social Media Strategy on Earth

From Mashable:

With more than 200 million Likes across all of its Facebook Pages, The Walt Disney Company is one of the most powerful brands around, online and off.

The Disney Consumer Products (DCP) division of the Walt Disney Company is responsible for various merchandise and licensing for different Disney properties — including leading franchises like Cars, Toy Story and Disney Princesses. DCP operates its social media presence under the name “Disney Living” and has managed to gain more than 300,000 Likes on Facebook, 29,000 followers on Twitter and 8.8 million views on YouTube in just under two years.

Disney Baby, an initiative designed to engage with parents of infants, launched its social media presence in January 2011. In less than eight months, Disney Baby has gained more 363,000 likes on Facebook, making it one of the biggest brands in its segment.

We wanted to know a bit more about the social media strategy for the world’s largest licensor — how does DCP engage with fans and with consumers, and what impact has that engagement had on the consumer products business as a whole?

To find out, we talked to Andy Mooney, the chairman of Disney Consumer Products. Under Mooney’s leadership, the fortunes of DCP have grown tremendously, thanks to decisions to create new verticals and new franchises. Mooney was the visionary behind the Disney Princesses brand, which is now a multi-billion dollar franchise.

Building a Community, Not Just Shilling Product

With a division like DCP, which operates on a 365-day release cycle, it’s important that the social media tactics and interactions are well crafted and well thought out.

As a “brand,” Disney Living has to make sure that its actions are not impeding on the work done by a licensee or that it isn’t going into more traditional Disney franchise territory.

As Mooney explains, “the studio builds a campaign around the theatrical release for Cars 2 and also has a campaign for the DVD, but then they go quiet. We have a 365-day cycle to sustain.”

If DCP, under its Disney Living moniker, was just to use its social media channels to promote licensed content or brands, it would get old. Fast. Instead, the goal for the social media strategy across DCP is to be informational, rather than super commercial.

You can see this in the type of content that is shared on the Disney Living Facebook, Twitter and YouTube pages. It’s not always product-driven — many of the communications are casual and centered on interacting with fans.

For instance, a recent YouTube video posted to the Disney Living channel goes behind the scenes with a LEGO Master Model Builder, showing off what goes into designing and creating life-size LEGO models of Toy Story characters.

The context with this type of video is not to promote the fact that LEGO is a licensee and has a Toy Story line of toys, but to give something back to fans.

Digital Publishing

An area where DCP is really starting to make a name for itself is in digital publishing.

Disney tells us that in just 18 months, more than a dozen children’s book apps have launched for iOS. The company recently started publishing in the Android Market. Disney Publishing has seven out of the top 10 apps in the Paid Books category — that’s overall titles, not just children’s books.

One of the first movers in the transition of digital publishing for kids, this is an area that Mooney really sees poised for growth. “The very nature of our publishing product going forward will be different than the product in the past. The new product is a multimedia experience and will be upgradable, relative to other forms,” Mooney says.

Still, he doesn’t believe that traditional publishing will completely disappear.

On the eBook front, Disney Publishing has over 300 titles available and has sold more than a million eBooks through July 2011. That’s more than double what was sold in all of 2010.

Disney is also getting into Digital Comics. Now that Disney owns Marvel, the opportunities to connect with comic book readers of all ages is really enhanced.

Having more digital properties, as a division, means that DCP has more avenues to leverage in its greater social media strategy.

Power of Social Media

Before joining Disney, Mooney spent 20 years at Nike, where he held a number of positions, including CMO.

“We didn’t have social media when I was with Nike,” Mooney says. “I wish we had, because what social media allows you to do is different from traditional consumer-facing advertising … Social media lets you uniquely connect with fans.”

Describing social media as something that is “adjunct to everything we do for deepening the emotional ties and the franchise,” Mooney stresses the importance of recognizing and connecting with a fan base.

“Some of these bigger franchise have massive fan bases.” The Toy Story brand alone has more than 27.5 million Likes on Facebook.

“Social media is fundamental to the nature of how we communicate with the fans,” says Mooney. “The tone and the content is more causal and insight-based and insider-based, especially for the most ardent fans of the franchises.”

A licensee can do a traditional campaign, and Disney Living can give an inside look at how stuff is done.

With Disney Baby, one of the newer social brands, the community itself is the focus, not the product.

As we mentioned earlier, Disney Baby is already in the top five baby brands on Facebook. Because the audience here is parents (mostly moms), the tone of the discussion is driven by the community members.

Parents share photos of their babies in Disney onesies. When a new product is released, if it’s posted to the Facebook Page, the community will talk about where to find it, who has the best price and what they think of the product.

Parents and moms also use the Facebook Page as a way to share stories with one another and ask questions. What’s bringing people together might be shared love for a brand — in this case, Disney — but the community goes beyond that.

That’s likely why Disney Baby has already had so much success.

John Lasseter Talks Toys YouTube Video Series

Debuting in 2009, this series of YouTube videos features Toy Story and Toy Story 2 director Jon Lasseter discussing the origins of each Toy Story character.

The Disney Living team found footage of John Lasseter talking about a new line of toys and uploaded it to YouTube. The videos were viewed by more than 1.8 million people, and two years later, the videos still get views.

Alfred Angelo Fairy Tale Weddings Launch

When Disney Living decided to change the designer of its line of Disney Fairy Tale wedding gowns, it was unsure of how the fans would react. The new line was more accessible — less expensive and less exclusive — and the team worried that existing fans would be upset with the change.

So, the Disney Living team put together a special YouTube video showing off the new gowns. The video gives viewers a behind-the-scenes look a the new line of gowns ad introduces them to the designer. The video has been viewed more than 1.7 million times, making it the most successful single YouTube video from Disney Living.