Walmart 2.0: Retailing Giant Announces Innovative Search Engine

GigaOM reports that Walmart has rolled out a new semantic search engine, code named Polaris, to better connect its users with the products they are looking for.  Polaris was the byproduct of Walmart’s 2011 acquisition of Kosmix (later renamed @WalmartLabs), a social media e-commerce startup focused on Internet taxonomy (aka “Social Genome” technology).  As GigaOM explains:

Polaris looks at the search term and tries to understand what a user is really looking for by matching the term and all its variations to a knowledge graph. It also applies engagement scoring and previous user actions to help refine its results.

That helps Walmart display more relevant results which can lead to increased sales. And it helps Walmart tailor its search experience to its users instead of relying on a generic third-party search engine.

And, at least in the short term it has been active, the results are promising.  In just a few months, Walmart has seen a 10-15% increase in sales conversions from searches.  That’s not small change.

This product launch illustrates that innovation and competition in the search engine space is becoming robust and multifaceted.  Besides the major search engines Google and Microsoft Bing (the latter of which recently partnered with Facebook and can now search the photos of your Facebook friends), many nontraditional “search” companies have developed their own search products.  Amazon recently rolled out Cloudsearch, Oracle purchased Endeca (which was Walmart’s prior search engine), and Apple released Siri (which is redefining how users think about local search).

Furthermore, the search startup space is also fairly active at the moment—although it rarely receives much attention.  Union Square Ventures invested in DuckDuckGo, a minimalist search engine with solid APIs, because they “became convinced that it was not only possible to change the basis of competition in search, it was time to do it.”  Linkedin has also gotten into the mix by acquiring the search engine startup IndexTank, and they have even open sourced it in an effort to speed up development.  Even China is seeing its search competition heat up, as upstart Qihoo (with an interesting/controversial business model to say the least) is making a head-on run at Baidu.

Needless to say Walmart’s successful entry into the market is a welcome occurrence as it forces the rest of the e-commerce and Internet industry to take notice.  Given that Walmart’s annual revenue is four times that of Google and Microsoft combined, I wouldn’t bet against them shaking up Silicon Valley if they put their mind to it.  At the very least, it will be interesting to watch the disruptive company that transformed supply chain management and brick-and-mortar commerce wade deeper into the Internet commerce pool.