Why Walmart Connect Expanded Its Advertising Partnerships

Why Walmart Connect Expanded Its Advertising Partnerships

Walmart

As the 2022 holiday season kicks into high gear, retail analysts are watching closely how much consumers will spend during a time of inflation. But it’s equally fascinating to understand how people shop. Walmart Connect, Walmart’s fast-growing advertising arm, believes that holiday shopping online – indeed all shopping online — will increasingly happen via social media, television commerce (t-commerce), and livestreaming. That’s one reason that Walmart Connect has expanded its advertising partner program to encompass social apps such as TikTok and streaming platforms such as TalkShopLive.

What Is the Walmart Advertising Partner Program?

Walmart Connect wants to help businesses advertise across the digital world beyond Walmart.com. To do that, Walmart Connect’s partnership program works with platforms to help brands scale, automate, and optimize their Walmart Connect advertising. These include partners that make it possible for Walmart Connect to expand self-service advertising through an application programming interface (API). Those API partners can be found here.

The partnership program is becoming more important to Walmart as it positions itself as a strong retailer-based ad platform alternative to Amazon Ads. And Walmart says the program is increasingly delivering value. For example, when BirdRock Brands turned to Pacvue (an enterprise software suite for eCommerce advertising) to scale its manual Walmart Sponsored Products campaigns, BirdRock was able to help design a campaign that ultimately experienced a return on ad spend 11 percent greater than its target, and an 83 percent increase in sales quarter over quarter.

What Did Walmart Announce About Its Advertising Partner Program?

Walmart has added a slew of advertising partners known as innovation partners. According to Walmart, these innovation partners will provide test-and-learn opportunities with formats such as social, entertainment, and live streaming throughout the entire holiday season. The newly expanded offering includes additional touchpoints and channels to reach customers wherever they are with new ad formats:

  • TikTok: this partnership provides an opportunity for advertisers to connect with potential shoppers on the red-hot TikTok platform. As Walmart noted, more than 50 percent of TikTok users say they watch ads on their feed instead of scrolling past them. The first-to-market pilot between TikTok and Walmart Connect will provide advertisers with the opportunity to serve in-feed ads on TikTok. This will leverage TikTok’s sound-on full screen video format together with Walmart Connect’s targeting and measurement.
  • Snap: the partnership with Snap enables advertisers to buy ad units including augmented realityCollection Ads and Snap Ads through Walmart Connect and take advantage of the Walmart Connect’s geo-based measurement. This is the first time advertisers can buy Snap ad units through Walmart Connect and get in front of the unique Snapchat audience (75 percent of 13-34 year-olds in the U.S.), who hold over $1.9 trillion in spending power.
  • Firework: this partnership enables supplier-funded shoppable livestreams and short shoppable videos on Walmart.com/live. Walmart Connect is testing how brands can leverage Firework’s capabilities to create premium, engaging, mobile-first video experiences and, to start, has partnered with Johnson & Johnson and Procter & Gamble.
  • TalkShopLive: Walmart Connect is expanding its relationship with TalkShopLive to partnership enable supplier-funded shoppable livestreams on Walmart.com/live, TalkShopLive’s platform, brand and publisher sites, as well as across the web. Walmart Connect is testing how brands can amplify their content and connect with shoppers at scale. To start, it has already executed livestreams with Johnson & Johnson, Procter & Gamble, and Samsung, among others.
  • Roku: Walmart wants to help make TV streaming the next e-commerce shopping destination. Walmart touts Roku as America’s Number One TV streaming platform (citing Hypothesis Group research). So, Walmart has become the exclusive retailer to enable streamers on Roku to purchase featured products and have the transactions fulfilled by the chain. Walmart Connect will connect brands to customers through the Roku platform, and checkout will be seamless for customers, while advertisers receive insights on effectiveness via Walmart Connect measurement.

In announcing these partnerships, Walmart discussed how online search and shopping has become more diversified especially in the post-pandemic age. Seth Dallaire, Executive Vice President and Chief Revenue Officer, Walmart U.S., wrote in a blog post:

Consumers who turned to online shopping during the pandemic have chosen to stay there, with those returning to in-store relying on online research to guide their decisions. Consumers realized the importance of “connection” and were forced to adapt and connect in new ways including social feeds, livestreaming, mobile and more, specifically across video and connected TV. In fact, the predicted growth of social commerce from 10% of all e-commerce to 17% by 2025 will be driven by Gen Z and millennial consumers and nearly two-thirds (64%) of social media users — an estimated 2 billion social buyers — said they made a purchase on social media in the past year.

Now, Walmart Connect intends to do its part in connecting social media discovery to actual sales. So far, Walmart Connect’s partnerships have been hands-on in nature. Brands get custom reporting about their campaigns, based on activations on Walmart.com’s live shopping, TikTok, Snap, and Roku. But Seth Dallaire told Advertising Age that the partnership program expanding to the point where it would be more automated and widely available within Walmart Connect, so that brands could better target ads on social media and connected TV.

Contact True Interactive

To succeed with online advertising, contact True Interactive. Read about some of our client work here and our Walmart Connect expertise here.

For Further Insight

Why Walmart Connect Is Winning,” Tim Colucci, February 25, 2022.

Why Retailers Are Launching Ad Businesses,” Tim Colucci, January 11, 2022.

Walgreens Doubles Down on Its Advertising Business,” Tim Colucci, May 19, 2021.

Amazon Unveils New Ad Units Across Its Ecosystem,” Kurt Anagnostopoulos, May 4, 2021.

Why Macy’s Launched an Advertising Platform,” Tim Colucci, March 3, 2021.

Walmart Asserts Its Leadership in Advertising,” Tim Colucci, February 8, 2021.

Why Walmart Connect Is Winning

Why Walmart Connect Is Winning

Walmart

For the first time, Walmart shared how much money its advertising business, Walmart Connect, is generating. And business is good. In announcing its quarterly earnings February 17, Walmart said that Walmart Connect achieved $2.1 billion in revenue in 2021. Why is Walmart Connect succeeding?

What Is Walmart Connect?

Walmart Connect is the name of Walmart’s advertising business. Walmart Connect creates targeted advertising by capitalizing on the customer data it has accumulated about search and shopping on Walmart.com and in Walmart stores. Walmart Connect offers many ad units. For example, Search Brand Amplifier makes it possible for a brand’s logo, a custom headline, and up to three of its products appear at the top of a web page (on Walmart.com), thus improving brand recognition and showcasing a company’s product portfolio.

What Did Walmart Announce?

In a conference call with Wall Street analysts, Walmart said that Walmart Connect is growing remarkably well. According to Walmart’s Chief Financial Officer Brett Biggs, “Walmart Connect advertising experienced robust sales growth this year with a strong pipeline of new advertisers and large growth opportunities ahead. In fact, the number of active advertisers using Walmart Connect grew more than 130% year over year. And about half of the ad sales came from automated channels in Q4, more than double last year. We expect Walmart Connect to continue to scale over the next few years with plans to become a top 10 ad business in the midterm.”

Why Is Walmart Connect Succeeding?

Walmart Connect is benefitting because the company relies on first-party customer data. Ad platforms that rely on first-party customer data are becoming more attractive as businesses such as Apple and Google make it harder for advertisers to capitalize on third-party customer behavior data to create online ads. First-party data is beyond the reach of these privacy initiatives. That’s a big reason why retailer-based ad businesses are flourishing – and Walmart is not the only one, as we blogged here.

Another reason for the success of Walmart Connect is that the company has offered automated advertising tools. As noted above, in a call with Wall Street analysts, Walmart said that half the advertising revenue in 2021 came through automated channels. This suggests that Walmart is doing a good job offering programmatic advertising — or the use of automated technology for media buying (the process of buying advertising space), as opposed to traditional (often manual) methods of digital advertising.

Although we don’t have any numbers yet, it’s also likely that Walmart’s physical stores will play a role in the growth of Walmart Connect. Walmart Connect sells ads on more than 170,000 screens — including televisions and self-checkout kiosk screens — located inside more than 4,500 U.S. stores. For example, TV Wall Ads provide placement of an advertisement on thousands of in-store TV screens in stores, with the goal being to influence shoppers while they’re making purchase decisions. Keep an eye on the in-store ad units. They are primed for growth as people become more comfortable shopping in stores post-pandemic.

What Should Advertisers Do?

  • Consider retailer-based ad networks as a complement to your existing digital ad strategy, not as a replacement. If your strategy focuses on Facebook and Google, for instance, don’t move your ad dollars over to a retailer network. Remember that Facebook and Google also already offer proven advertising products that capitalize on their vast user base. For example, location-based digital advertising tools help strengthen Google’s advertising services at the local level.
  • Work with an agency partner that knows the terrain. For instance, at True Interactive, we complement our history of helping businesses advertising on Google and social media with expertise across retailer ad networks such as Amazon and Walmart.
  • Learn more about the ad products that might apply to you – and those products are evolving. In 2022, more retailers will use first-party data to help businesses create more targeted ads off-site – meaning advertising across the web, as well as via connected TV.

Contact True Interactive

To succeed with online advertising, contact True Interactive. Read about some of our client work here and our Walmart Connect expertise here.

For More Insight

Why Retailers Are Launching Ad Businesses,” Tim Colucci, January 11, 2022.

Walgreens Doubles Down on Its Advertising Business,” Tim Colucci, May 19, 2021.

Walmart Asserts Its Leadership in Advertising

Walmart Asserts Its Leadership in Advertising

Walmart

Walmart is thinking big.

After a year during which the world’s largest retailer doubled ad revenue, Walmart is partnering with advertising technology company The Trade Desk to build a new advertising platform. The goal? To make Walmart an even bigger player in the advertising landscape than it is today, and take on rival Amazon as an advertising leader. Read on to learn more.

What’s In A Name?

The initiative begins with a name change. Janey Whiteside, chief consumer officer at Walmart, has announced that the retailer is rebranding its media business. Goodbye Walmart Media Group. Hello Walmart Connect. The new name hints at the sea changes in Walmart’s approach to advertising, including an expansion that links the retailer’s advertising business to in-store media.

Walmart Connect

It’s a canny move. While many retailers ignore their physical properties by conflating digital with online-only, Walmart is integrating digital with brick-and-mortar, in the process competing with Amazon’s muscular online presence. According to Reuters, the retailer will sell ads on more than 170,000 screens—including televisions and self-checkout kiosk screens—located inside more than 4,500 U.S. stores. Mark Boidman, managing director and head of media and tech services at the independent investment bank and financial services company PJ Solomon, believes the plan has promise. He notes:

The ability to use on-premise media, and in particular digital signage and digital out-of-home media, allows brands and retailers to be reactive and provide contextually relevant content and advertising, Think coffee promotions in the morning or marketing hot chocolate or snow shovels ahead of a big snow storm.

That means the messaging can’t — and won’t — be one-size fits all. After all, shoppers in Florida are unlikely to relate to snow shovel ads at any time. Walmart understands this; as reported in Ad Age, brand messages will be delivered specific to date, time, and geography.

Part of Walmart’s initiative also capitalizes on the company’s access to in-store and online shopper data. As the Wall Street Journal reports, this trove of data may well give Walmart’s demand-side platform an advantage over that of rival ad sellers, and help the company effectively compete for a bigger share of marketer dollars.

Implications of Walmart Connect for Brands

Walmart wants to share its data riches — with brands. By doing so, Walmart creates a win-win situation in which consumer needs are anticipated and marketers can remain agile in the face of changing need. “Walmart is pioneering a new frontier in digital advertising, providing marketers with access to shopper data for the first time, in a way that both protects consumer privacy and improves the consumer experience, Jeff Green, CEO and co-founder of The Trade Desk, noted in a statement. “In doing so, marketers will be able to create much more refined, relevant and measurable advertising campaigns, which can be adapted on the fly.”

What would that adaptation look like? For starters, marketers can target ads to audiences based on data about shopping behavior. In addition, advertisers can monitor sales in brick-and-mortar Walmart stores in real time, subsequently tweaking marketing campaigns as needed.

“We have this unparalleled source of data that we can bring to bear,” Whiteside says. “Who else can actually tell you if a customer saw something online and then a week later, physically bought it in the store?”

Smarter Advertising across the Web

Walmart isn’t just sharing data with brands available in Walmart stores. The company’s demand-side platform will allow brands not even sold at Walmart to use the trove of data — for a price — to better understand consumer habits, and subsequently craft messaging appropriate to those shoppers. In the past, most advertisers used the company’s data to expose shoppers to ads on Walmart properties — Walmart’s website and app, for example. The retailer means to expand that reach across the entire Web.

Contact True Interactive

In-store digital advertising. Capitalizing on consumer data so that both brands and shoppers benefit. In its aspirations to be a media powerhouse, Walmart is thinking outside the box to bring digital advertising to the next level.

Learn more about our expertise with Walmart Connect here.