If you're like most Americans, you probably don't think of Walmart as a major digital company. But within the digital marketing industry, the retailer is on everyone’s lips as a buzzy brand—thanks in large part to being one of the first marketers to set up an innovation lab.
Walmart opened @WalmartLabs—its massive tech innovation center headquartered in San Bruno, Calif.—in 2011 after acquiring the shopping search engine Kosmix and being in Silicon Valley since 2000. Within the past year, Walmart Labs has hired 1,000 workers, employing a total of 3,500 people, and has acquired 14 startups. While notable mobile, social and e-commerce tools have made Walmart the poster child of the innovation lab craze, the company’s goal of becoming a tech company on par with Facebook and Google is perhaps most interesting.
"What I think is a little bit different about how Walmart’s tapping into the talent and experience that lives in this part of the world is we're not just setting up a listening post or an innovation lab. We're building an Internet technology company," explained Brian Monahan, vp of marketing for Walmart.com.
That requires building an ad network, which is what WalmartLabs has quietly done over the past year.
Walmart Exchange—or WMX—is a platform available to brands that sell products at Walmart. Agencies buying ads for Walmart’s brands can use the tool to serve online ads in real-time based on shopper data, promising SKU-level measurement for marketers. Walmart’s media agency MediaVest also has access to WMX to manage its digital media buys on behalf of the retailer.
Since launching, Monahan said that WMX is rolling out new features weekly that track the performance of campaigns.
Meanwhile, @WalmartLabs is credited for cranking out mobile apps, e-commerce and social tools for shoppers. Just this year, it has rolled out a new e-commerce site, an app revamp that pulls in local inventory and a program called Savings Catcher. Savings Catcher is an app that scans a receipt to find prices at competing stores. If the app finds a cheaper price, shoppers get money back in the form of a gift card.
And, an internal search engine—built to help shoppers find products by typing in queries on Walmart.com—was launched in nine months by a handful of employees in 2012. The beefed-up search tool drove a 20 percent increase in online conversions.
Monahan said it all adds up to a bigger shift in retailers using digital for more than in-store shopping. Before joining Walmart last year, the exec worked at Magna Global.
"It became pretty clear to me in my craft—whether how we use data for targeting or how we create really innovative experiences with communications on phones and tablets and point-of-sale—that retail is right in the middle of it," he said.
This article is part of a series this week profiling seven brands' innovation labs. Click here to read more.