Walmart Smart Network unveiled

September 3, 2008 by Dave Haynes

Walmart today released detail on how they are going to entirely rethink and refresh the company’s massive in-store TV network, which includes some 27,000 screens.

Premier Retail Networks is still involved, and the relatively young research company DS-IQ has a itself a monster client now.

A newly formed company, called Studio2, will handle content. It’s not immediately clear, from the press release, whether Studio2 is a Walmart creation (and therefore asset)or a new entity that, like DS-IQ, has a rather nice primary client.

The rollout starts this fall and will take two years. The interesting and encouraging thing, to me, is how two years and $10 million led to the conclusion that the existing in-store network was all wrong and that it had to be re-thought. The new network involves greeting screens at the entry, targeted screens by department and, best, endcap screens humping the stuff for sale at those endcaps.

Hmmm, somebody else unveiled something like that a few months ago … 

Having Walmart pull the trigger on this will, I certainly hope, get some other retailers out of the starting blocks. It could be argued that the first iteration did not lead to other retailers doing their own in-store networks, but frankly, the first go-round was something less than inspirational.

The news release:

In a live event, simulcast between New York City and Bentonville, Arkansas, Walmart executives today unveiled the new Walmart Smart Network that will provide shoppers relevant and useful information via in-store TV. The first “shopper-intelligent network at retail” is the result of two years and $10 million in research and development used to identify the optimal locations, applications and programming for reaching the millions of consumers who visit the retailer’s stores each week.

Walmart is the first retailer in the US to rollout a next generation retail media network that is supported by a flexible, open enterprise platform powered by Internet Protocol Television (IPTV) — technology that will allow the retailer to monitor and control more than 27,000 screens in more than 2700 stores across the country. The Walmart Smart Network will also deploy response measurement and message optimization technologies to enable delivery of the most relevant content to shoppers — by store, by screen, by day and by time-of-day. All of the content on the Walmart Smart Network will be customized, designed to deliver helpful product information to consumers at the point of decision when and where they need it in the store.

“We’ve built a network tailored to the way consumers shop our stores — delivering helpful, custom, content closest to the point of decision — that helps them shop smarter,” said Stephen Quinn, chief marketing officer, Walmart Stores, U.S. “The Smart Network is intelligent too, because every screen and every message has a purpose and we will be analyzing point of sale data on an ongoing basis to deliver a shopper-centric communications platform. In short, the Walmart Smart Network is a win-win: improving the shopping experience for our customers and driving results for our supplier partners.”

Walmart will work with the following companies to implement the new network:

— Custom programming on the new network will be provided by Studio2, a newly formed company led by key advertising executives who are experts in in-store communications and were involved in the development and testing of the new network.

— Network operations, implementation, advertising sales and HDTV wall programming will be provided by Thomson’s Premier Retail Networks (PRN), Walmart’s current partner for these services.

— Response measurement, learning, and message optimization technologies will be provided by DS-IQ, which supplied analytical insights for the network pilot last year.

“I am incredibly proud of the partners who have joined us in this new venture,” said Clint McClain, senior director of emerging media for Walmart. “We have tested the new network extensively over the last two years and these partners have demonstrated best-in-class ability to engage shoppers with custom content, to manage a reliable and intelligent in-store network, and to deliver analysis that can power ongoing learning and optimization for our customers and partners.”

The Walmart Smart Network will begin rollout in September 2008. Upon arrival in the first stores later this month, the new network will deliver messaging at the entrance of Walmart Supercenters on “Welcome Screens”; in the departments that shoppers visit most often on “Category Screens” in grocery, health & beauty and electronics; and on “Endcap Screens” that will advertise the items displayed on key endcap displays throughout the store.

“One of the biggest challenges you face as an advertiser these days is really understanding your target audience in such a way that you know the best place to connect them with your message so that it can have the most impact,” said Kim Miller, vice president of marketing at Kellogg. “I believe moving forward, advertising at the point of sale will become increasingly important to win the market. The results we’ve seen during tests of the new Walmart Smart Network have been impressive.”

Walmart anticipates that the chain-wide deployment of 27,000 screens and its new Walmart Smart Network will be completed by early 2010. 

A Walmart senior communications also sent me a note to clarify that PRN is very active in the new network: Premier Retail Networks (PRN) has been a longtime partner with Walmart on its existing in-store network.  For the Walmart Smart Network, PRN will provide network design, operation and implementation, network advertising sales and services, HDTV wall and Checkout TV programming in addition to providing production services to the newly-formed Studio 2.

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