When it comes to kings of the retail space, two names come to mind: Amazon and Walmart. In breaking away from our usual topic of discussion, we plan on talking about Amazon today. Specifically, Amazon Connect.
With more than 90% of Americans shopping at Walmart over the past year, it is one of the largest retailers in the world. As a result, they have unique advantages with the release of their updated advertising platform.
But what do Walmart ads through the rebranded Connect platform do for your business? Find out more by checking out this in-depth guide on Walmart's updated platform. Also, you can check out this article to learn more about how to win the Walmart buy box.
1. What is Walmart Connect?
Walmart Connect is Walmart's new name for its advertisement group. Formerly known as Walmart Media Group, Walmart hopes that the rebrand will draw more attention to its advertising features.
The new release is also part of drawing focus to expansions to their media business. Specifically, additions to Walmart's digital advertising capabilities. The latest release focuses on three separate areas:
- Digital ads
- In-store experience
- Offsite opportunities
How Walmart is Addressing Digital Advertisement
Walmart has access to a wide swath of advertisement data gathered from tracking via the millions of people who visit their website. As a result, they have a good deal of knowledge on what people want. They are prioritizing awareness of that information through a direct display of sponsored products on their website.
The search and display advertisement style is now similar to Amazon in addressing buyer intent. Walmart advertising during 2021 has seen double the revenue from previous years. However, this change is still minimal when compared to Amazon's advertising.
Amazon has been in the digital advertising game for much longer than Walmart. Amazon has a much more robust list of websites. Walmart, by comparison, is incredibly limited in its offering.
Still, their latest addition of including sponsored products alongside where purchasing decisions are made makes this platform much more attractive. Walmart has the brick-and-mortar edge that Amazon lacks.
Walmart's Improved In-Store Advertising Experience
Walmart’s brick-and-mortar advantage allows for different advertising opportunities. You can do Walmart advertising in-store. While Amazon has some storefronts, they lack the same coverage level as Walmart.
Amazon Connect’s related feature allows big-screen televisions to display this advertisement. Brands seeking a direct method of impacting customers currently shopping will find ample opportunities to sell products in the store. Many people still make purchasing decisions while shopping at physical stores.
Walmart’s self-checkout system also allows businesses to find unique advertising opportunities. The effectiveness of this opportunity can change the minds of some impulse shoppers.
Walmart’s Offsite Focus
Walmart ads are said to become more dynamic with their recent partnership with The Trade Desk. The Trade Desk is an AdTech company known for data-driven advertising.
Through Walmart’s partnership with The Trade Desk, they seek to create a new Demand-Side Platform (DSP). From our recent look at Amazon DSP, you can use these platforms to develop programmatic advertising.
We imagine that Walmart will take a similar approach. However, we are still in the early stages of seeing this program unfold. It will be interesting to see how this impacts Ad Spend with competing retailers.
Walmart applies this approach to the following off-site areas:
- Social media
- Shopify stores
- Partnered websites
Much like Amazon, Walmart does partner with many off-site brands. However, that list is much smaller than what is available on Amazon.
2. Evolution of Walmart Connect
With Walmart’s first store going back to 1962, it’s interesting to see how they have grown over the years. But when it comes to their digital advertising platform, how has that changed over the years? Below, we will dig into the beginnings of Walmart Connect for further understanding.
Walmart 2011 - The Evolution of Their Digital Offering
Before Walmart could develop its advertising offering, it had to build its website. Walmart purchased Kosmix for $300 million to address this shortfall.
Kosmix is known for its ability to simplify the web. Merely ten years ago, Walmart’s website was a total mess. Chris Bolte, who worked with Walmart’s search marketing systems, stated that they felt it would be interesting to work with Walmart.
They were old school, much could be said about their “small-town charm.” They had (and still have) incredible popularity because of that. However, in 2011 Walmart recognized its dire need to remain competitive.
To do this, they had to create a functional search engine. Today, you can use an improved version of that search engine to find what you need. Understanding “buyer’s intent” is crucial to making an adequate engine.
Walmart has done so, including other various online-focused alternatives that include curbside pickup and delivery. However, creating a website provides the foundation for effective advertising.
From WMX To The Walmart Media Group
In 2018, The Walmart Media Group (WMG) was called WMX. WMX was Amazon’s advertising platform, which focused on audience-targeting efforts.
WMX combined with WPA, a Walmart Sponsored Search platform, and created a more consistent combination of advertising efforts. WMG was Walmart’s first foray into creating a unit that combined all of their platforms.
It also came with more improvements:
- A modern-looking Walmart.com with more focus on high-quality images.
- The allowance of off-site targeting features through Google, Facebook, and other social media.
- The ability to manage your ads closely with real-time reporting
- Trackable sales results with tangible benefits
Through this, Walmart's advertising efforts became more approachable and engaging. WMG was a stepping stone.
This evolution was three years ago, but it was still short of giving business owners what they wanted. Advertisers want more control over their ads.
Walmart has grown to include what they call an “omnichannel” focus. However, the next evolution came in 2020 with partnered advertisements.
How Walmart Advertising Partners Changed The Game in 2020
Going from late 2019 to 2020, Walmart acquired Polymorph, enhancing its ability to deliver robust advertising. The inclusion of Polymorph came with an announcement of the Sponsored Products Campaigns.
These campaigns are similar to Amazon’s offerings, allowing you to advertise across multiple websites. Walmart had access to partners like Flywheel Digital, Kenshoo, and Teikametrics.
The enhanced partnerships provided greater transparency, something that ad buyers have been crying out for some time. The enhanced availability was another step in the right direction that led to more enhanced features and actionable metrics.
The importance of metrics is abundantly clear. For example, we offer Amazon Product Analytics to ensure you can be competitive when introducing new products to Amazon.
Walmart Partners With Shopify
To address smaller groups, Walmart partnered with Shopify to bring over one thousand sellers to the Walmart marketplace. How does this apply to WMG? It reminds us that Walmart is attempting to appeal to small businesses.
Small businesses make up the backbone of Amazon. By opening up the marketplace to these smaller groups, you open up the advertising space.
This situation is also interesting because Amazon already deals with Shopify on its Multi-Channel Fulfillment (MCF) efforts. As Walmart grows its small business efforts, WMG has to change to meet the demands of a wider audience.
Walmart Connect has a better opportunity to meet those demands.
From WMG to Walmart Connect - What Has Changed?
Walmart Connect does a few things differently from what we’ve mentioned above. However, it provides one advantage that Walmart desperately needs regarding Walmart ads: branding and awareness.
Before this announcement, many people were unaware that WMG was there. While it has grown significantly over the past few years, it is still relatively weak compared to competitors’ offerings on advertising.
Walmart Connect is far more pleasant to look at, as it provides ad buyers with the reminder of what Walmart has over Amazon: direct connection. Given that shoppers still tend to make purchasing decisions in the store, Walmart has a much more robust opportunity to target these consumers.
Walmart is making these decisions primarily to do one thing: compete with Amazon on its level. With this in mind, is it a helpful advertising platform?
3. Why Should You Invest in Walmart Connect?
What puts Walmart above the rest compared to Google, Facebook, and other digital advertising platforms? Below are some advantages Walmart has over other providers.
It Offers Advertising at the Source
Browsing Amazon is sometimes a source of boredom for some people. However, going to a Walmart store typically doesn’t mean the same thing. When you are in a retail environment, you are almost always there for shopping.
While you can say the same for Amazon, that isn’t always the case. Seeing an engaging advertisement in a store can convince you to make a purchase. This situation is especially true if you are already in a shopping mood.
Walmart Has Stores Within Reach of Most Americans
Walmart claims that 90% of Americans either have shopped or are within 10 miles of a Walmart store. That’s a staggering number of people, giving you an excellent opportunity to direct regional campaigns.
If you happen to be selling high-quality lamps in a specific region, you can direct your advertising to ensure your ad spend is inexpensive. The latest Walmart advertising updates allow you to focus on these areas, so you don’t have to pay for the whole thing.
Walmart is Better Suited To Grocery Providers
With physical locations, Walmart is better suited for the storage and handling of food. Below are a few examples:
- Fresh items
- Organic items
Online retailers lack the same ability to send many of these items. This situation can be especially concerning when addressing shipping delays, which could ruin any attempt to ship these items to your desired location.
Walmart ads can focus on advertising your vegetables or fresh meats. As a result, you can direct your efforts to hungry customers thinking of their next meal.
Walmart Marketplace Gives You Comprehensive Controls
Walmart’s process for being competitive with sales is pretty similar to Amazon’s. Below are a few comparisons:
- You compete with fellow sellers for the “buy box.”
- Pricing is still significant.
- Creating dynamic and keyword-laden description pages will help you.
- Walmart SEO is a thing.
Unlike other providers, Walmart focuses on referral fees per item. These fees come from a percentage of that item. Those fees typically shrink based on the potential cost and type of thing you sell.
Walmart Has A Huge Number of Partners
Walmart works with a wide range of companies that offer various services. These can include anything from product listing to inventory management. The idea is that some manufacturers are better at producing the product than advertising.
That means if you are a company that specializes in making handmade items, you could direct your attention to their creation. That means less time having to worry about the other side of the issues.
Their partners can help with the following:
- Inventory management
- Order fulfillment
- Listing optimization
- Business scalability
They Have A Blog That Helps New Sellers
The Walmart Sell Better Blog provides you with news and updates on what’s going on with Walmart. The information they talk about can be anything from initial setup to tax information. They even provide fashion advice.
Walmart is a large organization that provides robust solutions to all levels of sellers. Like most blogs, they are more helpful to those who are new to selling on Walmart Marketplace.
4. Disadvantages of Walmart Connect
Not everything is best for Walmart Connect. Below are some of the disadvantages of its use:
It Isn’t Great For Non-Walmart Sellers
Walmart’s process for accepting and sending out new items is relatively simple. You can complete it on Walmart Marketplace. However, putting those items in a storefront can be a bit more tricky.
Walmart isn’t going to want to advertise goods that it doesn’t sell. There are also more established advertising methods out there that apply to more minor business-specific needs. A good Google AdWords campaign can be beneficial.
Walmart’s Seller Program is A Bit More Complex
Walmart’s supplier program includes over 100 thousand businesses. The supplier checklist provides you four pages worth of information. You can’t be “a person” selling to Walmart; you need to be a business.
Below are a few excerpts:
- Legal company name
- Administrator contact information
- Corporate address
- Tax information Remit address
- Insurance requirements
- Business registration certificate (only for direct import suppliers)
By comparison, any individual can create an Amazon seller account. The barriers to entry are much lower, and Walmart has fewer solutions for smaller providers.
Walmart Has Slower Shipping Times
Walmart Marketplace provides two- or three-day shipping opportunities to its sellers. It also offers taking over the fulfillment process. All of this is great, but it is something provided with more quality through Amazon.
Amazon Prime typically does one-day shipping with many of its products. Other providers struggle to compete. While Walmart is excellent at saving money and bulk shipments, it isn’t as effective at providing quick turnaround times.
4. How is Walmart Connect Competing With Amazon Ads?
When it comes to Walmart ads, it’s complicated for them even to consider competing with Amazon. Still, Connect provides a unique opportunity for product sellers.
Below is a list of ways Walmart is competing with Amazon:
- Physical storefronts
- Superb metrics tracking (with a company of your choice)
The Physical Store Competitive Advantage
The major competitive advantage for Walmart comes back to a robust list of physical stores. Amazon is experimenting with stores, but they are much less strong in their offerings.
Amazon may continue to address these limitations by releasing more physical stores. Walmart is going to do the opposite by delving further into the digital field.
For now, Walmart would do well to leverage this advantage if at all possible. By reminding advertisers of the number of purchasing decisions people make in stores, Walmart can drive home the point and continue to increase ad revenue.
How Does a DSP Help Amazon?
Walmart advertising is also attempting to use DSP. A DSP creates programmatic advertising that allows sellers to have greater control over their display and search ads.
For example, let’s say that you target “beach towel” as a keyword of choice. You manage to get ahead of the competition by starting before summer. However, when summer comes, you might receive notice that the bid price for your advertisement has gone up.
At that point, you have two choices: raise your bid price or consider an alternative keyword. While decisions are typically more complicated than that, the idea is that a DSP simplifies the process by automating that decision.
Walmart’s API and Partnerships With Metrics Companies
Amazon has partnered with the following companies on tracking metrics:
- Harvest Group
This list does not include everyone. It’s important to note that Walmart does not handle any of the trackings by itself.
For people who already have experience working with these companies, this isn’t necessarily a bad thing. Otherwise, it allows people to compare these companies to see which will be the best fit.
As the battle between these two retail behemoths rages on, it will be interesting to see how the two trade blows. Ideally, Walmart will want to be sure that Connect applies to all levels of seller. They will also want to provide that same level of access on Amazon Marketplace.
5. Walmart Connect FAQs
How Do You Sign Up For Walmart Connect?
You can signup for Walmart Connect by clicking the “Start Advertising” button in the top-right-hand corner of their site. You’ll need to provide the following information to them:
- Type of business
- Contact information
- Job title
- Company name
- US Tax ID
- How you heard about Walmart Connect
What Does “Omnichannel Marketing Refer To?”
Omnichannel marketing is the combination of multiple marketing channels. Typically, omnichannel marketing attempts to remain consistent across all channels. The goal of this marketing effort is to spread a particular brand message.
In Walmart’s case, their omnichannel strategy includes the following areas:
- Walmart storefronts
- In-store ads on various screens
- On-site display advertising
- Search-based advertising
- Digital ads
6. Wrap Up
Walmart Connect is a powerful potential advertisement platform that you can use to diversify your campaigns. However, you’ll find that it’s most useful for people who sell at Walmart. As a result, it isn’t an excellent environment for young sellers.
Ideally, you can build your business and experience up with Amazon, potentially planning to expand to Walmart in the future. Eventually, your business might grow large enough to produce a branded brick-and-mortar store yourself.
By diversifying your options, you give yourself great opportunities to learn. It’s essential to be willing to grow your business. To assist you in understanding one part of this growth, consider DataHawk's Amazon Financial Reporting to correlate sales data with other vital metrics. Understanding the complete picture of your business is crucial when remaining competitive.
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