This amazing Black Friday collaboration is a harbinger of retail to come
Even if you don't live in the US, you've probably seen headlines on the biggest retail days in retailing. But there's a behind-the-scenes story of collaboration that unfolded on this year's Black Friday that you may have missed. Indeed, it is a harbinger of the future of retailers collaborating with new technology to differentiate, and be competitive in a real time online world. There is an old saying about "When pigs fly" referring to things perceived to be impossible. This one seems so unimaginable that it warrants the moniker "When whales fly".
The Whale of Retail is certainly not dying … or lacking in innovation
I have posted before referring to Walmart as the "Whale of Retail". In terms of sheer size, Walmart's $450+ Billion in annual revenue dwarfs anyone by comparison. While Amazon grabs the headlines, it is only about 10% of Walmart in annual revenue. And, Walmart certainly isn't resting on its laurels or rolling over to Amazon's relentless pursuit.
Walmart has in fact created an "Innovation Center," which is setting new standards for R&D in retailing. Walmart has also purchased media companies, as well as investing in social media. In fact, Walmart even created Facebook pages for every one of its US stores. But it is Walmart's latest Facebook adventure which shows that this retailer is no longer your Mom's Walmart … it is breaking new ground in reaching consumers in new ways beyond its stores and website.
How Walmart & Facebook Collaboration turned Black Friday Green
I originally pick up this story line from one of my favorite sources: MorningNewsBeat.com. This post cites a Wall Street Journal December 17th article about an amazing collaboration between two "whales" that took place over Black Friday. Few could have imagined such collaboration even a couple of years ago. And, few could have imagined that ads on Facebook would successfully drive sales for Walmart who is king of driving traffic, especially on Black Friday, the busiest day of store retailing in the US.
According to the WSJ article, on Black Friday, Walmart rolled out the biggest social network mobile advertising campaign ever … over 50 million ads for discounted deals on toys and TVs that popped up on Facebook's mobile news feeds of tens of millions of people. This was NOT typical Facebook ads. Walmart pre-purchased huge ad volume and dominated space on Facebook's new platform. This effectively blocked other retailers for 72 hours during the most critical period of Black Friday.
What the success means for the "Whale of Social Media" – Facebook
Let's face it. Facebook's IPO and stock price has not been stellar! The biggest knock against Facebook has been how to monetize value and generate new revenue streams. And, experiments of using Facebook pages and Facebook ads have almost futile in terms of driving significant retail sales. Having measureable success in driving the world's largest retailer's sales provides Facebook with the "retail cred" that can be leveraged to experiment with other large companies and in other areas such as mobile advertising, where it has been weak.
Facebook must "deepen relationships with some of the world's biggest advertisers by tailoring ads to those companies and using those brands as labs to test new ad products. What better way to launch than actually drive sales and showcase technology potential with the "Whale of Retail".
What the success means for the "Whale of Retail" – Walmart
While Walmart is the largest store based retailer in the world, it's no secret that it has been struggling. Growth has been stagnant, with no comp store gains in the US. Walmart has invested heavily in its own ecommerce, and is piloting innovations such as one day shipping and purchase online with pickup in store. But while Walmart's whale status is an advantage in terms of leveraging buying clout and distribution expertise, it needs to develop capacity to nimbly respond to competitors like Amazon, who can literally change prices every hour.
The issue for Walmart like every other retailer in the US is that the consumer behavior is changing. Consumers are not just shopping in store. They are more fluid and increasingly relying on mobile devices. Walmart must adapt to these changing consumers by reaching them where and how they shop. The Black Friday Facebook collaboration enabled Walmart to become "Amazonian" and quickly make changes on the fly on Black Friday. "When Walmart found that a pair of $88 speakers weren't selling as quickly as expected on Friday, it posted the item on its Facebook ads as a 'special buy'. Walmart said that the item soon sold out across the US."
The Changing Face of Retail … Tomorrow will be real time on the fly
No one would have predicted this kind of collaboration between Walmart and Facebook two years, or even a year ago. Walmart didn't have the capability to pre-purchase all of the Facebook ads until the new innovation was created. Previously, companies only paid Facebook after users saw their ads. Now with pre-purchase, Walmart dominated the mobile ads during a very peak selling period to skillfully drive sales, and block competitors.
The best way to predict the future is to create it. The Black Friday collaborative test between Walmart and Facebook is the harbinger of how things will work in the future. Whether it is Facebook, Twitter or another social media, the key is reaching consumers where they are. And the name of the game in retailing tomorrow is being able to measure exactly what consumers respond to, and what they do not.
The future of retail is being able to make changes on the fly AND measuring results that count as they happen. It is not just about having fast accurate business intelligence … but the means to act upon it and leverage it.
- MorningNewsBeat.com: Walmart, Facebook Collaboration Turned Black Friday Green
- Photos: Google Images