Why Wal-Mart Will Succeed In Social Applications
by Josh Bernoff
I just got back from a trip to Bentonville, Arkansas, home of America’s largest and perhaps most controversial retailer. While there, I met with the company’s top management, IT staff, and a couple of social media folks.
You may believe that this company will never “get it” – and that in any cases, it has so many enemies that entering the social world would be suicidal. Let’s see if I can convince you that Wal-Mart will become social media’s biggest success story.
Wal-Mart’s social saga starts with a couple of missteps, including a blog that was revealed to be funded by Wal-Mart’s PR agency, Edelman, and a Facebook application for college students that attracted lots of negative comments from Wal-Mart haters. But when 138 million Americans go into your stores every week, you shouldn’t ignore social media, and you can’t hide from it. Wal-Mart didn’t give up after these setbacks, they got up off the mat and tried harder.
Exhibit A: ratings and reviews. Walmart.com is one of the biggest Bazaarvoice installations in the world, powering a site that sells over a billion dollars worth of stuff every year. Wal-Mart is not afraid of negative reviews from customers – for example, the top rated bicycle on the site had 139 reviews including “7th gear skips fairly frequently. . . but at $150, you can’t expect not to find problems.” Wal-Mart is famous for driving hard bargains with its suppliers; we met their PR folks in one of the very windowless, grey rooms where those prices get beaten down. Reviews on walmart.com have most likely extended that power, as the company now has concrete evidence about which products consumers consider to have acceptable quality, and which not.
Exhibit B: the checkout blog. Wal-Mart’s buyer blog is still growing in popularity, but has enabled the company to join the conversation about products. It’s a genuine voice for Wal-Mart’s product folks, enabling them to explain decisions like choosing Blu-Ray over HD-DVD, (a choice that basically put the final nail in the coffin of the HD-DVD format). A post on Wal-Mart buying only milk from cows that don’t receive growth hormone generated a lively and in some cases uncomfortable discussion with 256 comments. Wal-Mart has learned to join the conversation, even in a world full of critics, and is not smothering those that disagree.
Exhibit C: elevenmoms.com. Emboldened by its experience, Wal-Mart tapped a colony of mommy bloggers who write about topics like how to feed your family frugally and how to get ready for Halloween. Don’t sell moms short – these are some pretty sophisticated blogs and Wal-Mart hasn’t changed them at all, they just link to them, and are now bringing the bloggers to Wal-Mart HQ for updates and suggesting products for them to review. Learning from past experience, Wal-Mart and the moms have both made it clear that these bloggers aren’t paid and are under no obligation to slant things Wal-Mart’s way.
Exhibit D: management attitudes. This may be the most powerful of all. Some members of Wal-Mart’s senior HR staff had read Groundswell and asked me to present on the social media topic to 75 senior VP and C-level executives from around the world, including CEO H. Lee Scott. We followed this up with a workshop similar to the ones I run around the country, in which people use the POST method to generate social application ideas. Could a group of C-level executives break into groups and successfully devise social applications? I started to get worried when I saw they’d put all the lawyers together as one of the groups.
What happened next amazed me. When I kicked off the
workshop, I mentioned that they might be feeling a little hesitant about these
new ideas, since they involve a loss of control. Lee Scott actually interrupted
me to say “You’re wrong, we’re not hesitant, we’re ready to embrace this stuff.”
And they were. What followed was some of the most rapid ideation I’ve ever
seen. I can’t tell you in detail the strategies they came up with – they
deserve the chance to develop and announce them when they’re ready – but every
single one was a viable, customer-centered idea around concepts like customers saving
money or sustainability (that is, green) ideas for Wal-Mart. Even the lawyers came up with a decent
(For cynics who might want to believe this was done just to fool me, trust me, the world’s largest public company has better things to do than bring its top management together from around the world to fake out a business book author.)
Having done lots of these workshops, I’m aware there’s no
way to know when these plans will see the light of day, but what I saw was a
company open and receptive to embracing and empowering its customers and
employees online, regardless of what they end up saying. In short, advanced
Think about the situation Wal-Mart is in. It has plenty of
detractors, hundreds of people who feel the company’s labor practices, effects
on small-town America,
purchases of products from
But on the other side of the ledger are hundreds of millions
of customers. When these customers think about Wal-Mart, their most likely
thought is “they sell the stuff I need at really low prices.” If you don’t
believe me, see what they’re saying right now on Twitter –
it’s mostly about saving money. Wal-Mart wants to turn these millions of voices
to their advantage, to use them as a counterweight to their detractors. And
with more and more Americans participating in social technologies, they can do it.
Have I convinced you?
The Wal-Mart haters won’t go away (I expect plenty of them to comment on this post, for example). But this company has legions of people who think of it as a place to get good stuff cheap, and a commitment to pro-social activities like saving energy and responsible sourcing. It’s going to be a battle out there in the social sphere, and Wal-Mart will continue to take its lumps. But with so many customers on its side, I think Wal-Mart will win that battle. Just watch.