Will Wal-Mart Become A Technology Leader?

| About: Wal-Mart Stores, (WMT)

Silicon Valley has an unlikely player making waves in recent months. That player is retail behemoth, Walmart (NYSE:WMT). Since acquiring Kosmix - a small social media data trend analysis startup - nearly a year ago, Walmart has been pushing hard hiring programmers and acquiring other social media companies.

The division known as @WalmartLabs recently acquired Small Society, an iOS apps company. The acquisition is the third since the Kosmix acquisition and renaming to @WalmartLabs with the others being Grabble (a QR Code scanning application company) and OneRiot (a social media advertising company).

Add all this up and you have a very aggressive push by Walmart into the convergence of mobile and social technologies.

This past holiday season, @WalmartLabs introduced the Shopycat Facebook app which assisted consumers in finding holiday gifts.

While most business analysts view mobile and social as the spaces that companies must participate in moving forward to grow their business, it's definitely unclear what a company like Walmart can gain from this area. I view these investments as necessary, but definitely not a guarantee of any financial returns. Why are they necessary? Because frankly, it is a larger risk to miss this trend than whether or not it will materialize in increased market share or sales.

While social media and mobile apps are major factors in our lives, whether or not a $200 billion retailing company can use them to move the needle moving forward is a big question mark.

Walmart has the cash to invest in this space, and they are obviously set on making a hard run at mobile and social technology and integrating it into their business. We likely won't know how much fruit this will bear (if any) for many years. As a shareholder, I think it's a good move for Walmart to attempt to get ahead of the curve.

This is a long-term investment. Most of Walmart's customers will continue to simply shop at their local supercenter, but it's difficult to say what retailing will look like in 15 or 20 years. Investing in top technology talent to research and try out new ways to interact with consumers makes a lot of sense for a company like Walmart.

We will continue to monitor the @WalmartLabs division, new apps/technologies that they release and any user numbers or financial results that Walmart may release regarding their technology investments at WalmartInvestor.com.

Disclosure: I am long WMT.