Walmart Stretches Reach Through Ad-Sales Business
Ads to Appear on Self-Checkout Screens
Walmart (WMT) is working on an overhaul of its ad-sales group, Walmart Media Group. The new advertising arm, renamed Walmart Connect, will feature new advertising technology for companies to use, and will offer available targeted ad space on Walmart’s in-store checkout screens.
The move comes as part of Walmart’s larger campaign to diversify its revenue and enter the ranks of the top 10 ad companies. Representatives say Walmart Media Group has doubled its advertising customers and revenue in the past year.
Brands will soon be able to use customer data collected by Walmart to target consumers around the internet. Until now, most advertisers took advantage of Walmart’s data solely to market to consumers on the Walmart website and app.
Retailers Compete with Tech Giants on Ads
Walmart is not alone in its ad diversification efforts. Other retailers like Kroger (KR) and Target (TGT) have also been exploring the digital ad space. The larger strategy is to uncover a new revenue stream by providing advertisers with access to the growing ranks of online shoppers on these retailers’ websites.
Walmart is not yet able to compete with online advertising giants like Alphabet’s Google (GOOGL), Facebook (FB), and Amazon (AMZN). But it does have an angle that these online platforms do not: Walmart has access to both online and in-store shoppers. That expanded data could help the company compete with online-only ad sellers. Walmart eventually plans to let advertisers purchase targeted ad space on display screens in all 4,500 of its stores.
Pandemic Drives Walmart’s Ad Push
The ecommerce boom resulting from the pandemic has accelerated Walmart’s moves into the digital ad space. In the most recent quarter, Walmart’s e-commerce sales jumped by 79%. Those sales made up a heavy portion of the company’s larger gains. Target, Kroger, and many other brick-and-mortar retailers also saw online sales boom in the most recent quarter.
If the pandemic shopping trends continue in a post-pandemic world, Walmart could have a head start in modernizing its ad sales for new types of shoppers. Leaders in the advertising industry as well as the retail space will be eager to see how Walmart’s initiatives take shape.
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