Sunday, September 21, 2008

The Nation's #1 Retailer is The #1 Network

Walmart didn't get to be the nation's #1 retailer by accident: besides being brutal negotiators with suppliers and a carpet bomb approach to opening new stores, they also have always looked to embrace new technology. With the launch of their "Smart Network," they have take the game up a notch: multimedia displays in aisles carry custom Walmart programming via the Internet, allowing them to change media content on the fly. Why, you ask? Simple: the more relevant content, the more you buy.

Here's an example: it's football season, and they want to promote Frito-Lay products. Walk down the snack aisle, and see the current scores from the games and headlines from the football news. Or, as Retail Wire points out:

For instance, the network can show promotions based on weather conditions. Soup may be promoted if it's raining outside the store, said Clint McClain, Walmart's senior director of emerging media. Ads may promote barbeque items if it's going to be eighty degrees on Saturday. Promotions might also be arranged around local events, such as a nearby college football game. The network also offers different items depending on the time of the day. For example, promoting frozen pizza at 5:00 p.m. has already proven to be a big winner with moms looking for an easy dinner for their kids. At 10:00 a.m., the ads showed no lift.

Mr. McClain likened this greater promotional flexibility to how "umbrella stores suddenly pop up" when it rains in New York City.

Don't confuse this with the new TV channels at the checkouts they feature; those are like comparing a pocket calculator to an iPhone. No, this is a serious tech assault. Want to be a little scared? Walmart was one of the largest companies to insist on RFID tags in all merchandise; these tags broadcast small coded radio signals to allow them to be scanned for inventory and checkout purposes. Now, imagine the Smart Network has an RFID reader and can scan what you have in your cart; it can actually change the programming of the screen nearest to you to reflect complimentary products or promote products from the same manufacturer in that aisle. Talk about personalized shopping!

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