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Walmart announced that it has signed a definitive agreement to acquire Kosmix, described as “a social media technology platform that filters and organizes content in social networks to connect people with real-time information that matters to them.”

According to the announcement, “the Kosmix team will operate as part of the newly formed @WalmartLabs and continue to be based in Silicon Valley. Walmart plans to expand the @WalmartLabs team and expects this new group will create technologies and businesses around social and mobile commerce that will support Walmart's global multi-channel strategy, which integrates the shopping experience between bricks and mortar stores and e-commerce ... Kosmix's innovative technology platform searches and analyzes connections in real-time data streams to deliver highly personalized insights to users. The platform powers TweetBeat, a real-time social media filter for live events with more than five million visits last month;, a site to discover social content by topic; and RightHealth, one of the top three health and medical information sites by global reach.”

"We are expanding our capabilities in today's rapidly growing social commerce environment," said Eduardo Castro-Wright, Walmart's vice chairman. "Social networking and mobile applications are increasingly becoming a part of our customers' day-to-day lives globally, influencing how they think about shopping, both online and in retail stores. We are excited to have the Kosmix team join us to accelerate the development of our social and mobile commerce offerings."
KC's View:
Once again, the big question is whether this is a strategic move or another “spaghetti against the wall” effort.

To me, it sounds like strategy. It sounds like Walmart wants to get a better handle on the connectivity between its brick-and-mortar and virtual operations, and a stronger read on who its customers are and what they are buying.

Some will argue that this yet again takes Walmart away from its core competence, and serves as an MBA-led distraction from the serious challenge of offering low prices to its primary customer demographic. And while I understand the feelings behind that argument, I’m not sure that you can play the retail game in 2011 without being invested in the social media and virtual environment.