Walmart Advertising Strategy: Why Amazon Sellers Should Care

Walmart's recent acquisition of Vizio for $2.3 billion indicates how serious they are about ramping up their advertising game and taking on Amazon in the online ad space.

Understanding what's happening between these two ecommerce giants is crucial if you’re an Amazon seller. By analyzing and comparing Walmart's advertising strategy with Amazon's, sellers can glean valuable insights to refine their ad tactics.

Let’s break down Walmart's advertising moves to compare with Amazon’s. The goal? To give Amazon sellers some practical insights they can use to get ahead in the competitive world of digital advertising.

In this article, we’ll share how:

• Both giants approach digital ads and highlight the differences and market positioning impacts
• Walmart's acquisition of Vizio gives them access to valuable consumer data from over 18 million active SmartCast accounts, boosting their advertising capabilities.
• Sellers can navigate the opportunities and challenges for optimized advertising, results, and return on investment (ROI)

As Walmart makes bold moves to strengthen its position in the digital advertising arena, Amazon sellers need to understand the consequences of these changes. Let's take a closer look at how the evolving digital advertising landscape can affect your business.

Walmart vs Amazon: The Battle for Digital Advertising Dominance

As the battle between Amazon and Walmart heats up, Walmart's strategic move into the smart TV market signals a major shift in the dynamics of digital advertising. Walmart now gains access to a new audience segment, offering advertisers novel targeting capabilities and advertising avenues. This move potentially diverts advertisers from Amazon, who are attracted by Walmart's promise of unique opportunities to reach consumers.

Walmart Advertising Strategy and Platform: Walmart Connect

Walmart's advertising platform has been steadily growing and evolving. With the acquisition of Vizio, Walmart Connect is set to expand its capabilities and reach.

The platform offers a range of ad formats, including sponsored products, search ads, and display ads, allowing advertisers to target consumers at various stages of their shopping journey.

• Leveraging Vizio's First-Party Data: With access to Vizio's extensive first-party data on consumer viewing habits and preferences, Walmart can create highly targeted and personalized ad experiences, driving better engagement and conversion rates.
• Connected TV Advertising: The acquisition of Vizio opens up new opportunities for Walmart in the connected TV advertising space. Advertisers can now reach consumers directly through Vizio's smart TVs and streaming services, expanding their reach and impact.
• Omnichannel Integration: Walmart aims to create a seamless advertising experience across various touchpoints, integrating in-store and online advertising, leveraging location-based targeting, and creating cohesive brand experiences throughout the customer journey.

Amazon's Advertising Approach & Ecosystem: Amazon Ads

Amazon's advertising ecosystem, Amazon Ads, has been a dominant force in the digital advertising space. With its vast user base and rich consumer data, Amazon Ads provides advertisers with powerful targeting options and formats. From sponsored products to video ads, Amazon Ads has been the go-to platform for many sellers and advertisers.

• Dominance in Ecommerce Advertising: Amazon Ads has been a dominant force in digital advertising, particularly in ecommerce advertising. With its vast user base and rich consumer data, Amazon Ads provides advertisers with powerful targeting options and formats, such as sponsored products, sponsored brands, and video ads.
• Expand Beyond Ecommerce: Amazon has been expanding its advertising reach beyond its ecommerce platform. Through initiatives like Amazon Publisher Services (APS), the company is partnering with publishers and developers to extend its advertising network.
• ‍Video and Over-the-Top (OTT) Advertising: Amazon has invested heavily in video and OTT advertising, leveraging its Prime Video platform and Fire TV devices to offer advertisers access to a highly engaged audience.

Comparing and Testing Advertising Strategies

While both Walmart and Amazon offer robust advertising platforms, there are expected to be more notable differences in their strategies and approaches from this new acquisition. Let's compare! 

• Advertising Platforms: Walmart Connect and Amazon Ads offer a range of ad formats and targeting options. However, Walmart's acquisition of Vizio gives it a unique advantage in the connected TV advertising space, while Amazon's strength lies in its dominance of e-commerce advertising.
• Data and Targeting: Walmart's access to Vizio's first-party data complements its own vast trove of customer data, enabling more precise targeting and personalization. Amazon leverages its unparalleled e-commerce data and customer insights to deliver highly relevant ads.
• User Experience: Amazon Ads benefits from its seamless integration with the Amazon ecommerce platform, providing shoppers with a familiar and convenient user experience. Walmart Connect, with the integration of Vizio's smart TV platform, aims to create a more engaging and interactive advertising experience.
• Ecosystem and Partnerships: Amazon Ads has the advantage of being deeply integrated with Amazon's extensive ecosystem of products and services. Through strategic partnerships like the one with Vizio, Walmart is expanding its advertising reach and capabilities beyond its traditional retail domain.

As an Amazon seller, it's essential to recognize the potential impact of this development on your advertising strategy and test both advertising platforms to decide which delivers the best results for your business.

Subscription Services: Walmart Plus vs Amazon Prime

Walmart Plus and Amazon Prime are subscription services that offer exclusive benefits to their members, including free shipping, streaming services, and more. Both services also play significant roles in their respective company's advertising strategies, influencing consumer behavior and brand loyalty.

Walmart Plus

Pros

• Integration with In-Store Shopping: Walmart Plus offers unlimited free delivery from stores, which includes groceries and other items, making it highly attractive to customers who prefer or need same-day delivery. This integration can be a powerful advertising tool, as campaigns emphasize convenience and speed, appealing to consumers who value quick product access.
• Fuel Discounts: Members may receive discounts on fuel at Walmart, Murphy, and Sam’s Club fuel stations. These tangible, everyday savings can be highlighted in advertising campaigns to attract cost-conscious consumers.
• Increased In-Store Traffic: With the Scan & Go feature, members can use their phones to scan items and check out without waiting in line. This feature encourages in-store visits, which can be used to promote in-store promotions and drive sales through targeted advertising.

Cons

• Limited Streaming Services: Unlike Amazon Prime, Walmart Plus doesn’t offer extensive streaming services. This can be a drawback when attracting customers interested in entertainment options, limiting the scope of lifestyle advertising.
• Brand Perception: Walmart is traditionally seen as a value-oriented retailer, which doesn’t align with premium customers. Positioning Walmart Plus as a premium service can be challenging, affecting its appeal in advertisements targeting higher-income demographics.

Amazon Prime

Pros

• Extensive Digital Content: Amazon Prime offers a vast library of movies, TV shows, and music through Prime Video and Prime Music. This allows Amazon to promote a comprehensive entertainment package, making its ads more appealing to a broad audience.
• Prime Day: Amazon’s annual Prime Day offers exclusive deals to Prime members. This event drives massive traffic and sales and is a powerful tool for creating hype and urgency in advertising campaigns.
• ‍Global Reach: Amazon Prime is available in many countries worldwide. This presence allows Amazon to leverage a broader range of advertising campaigns and reach a more extensive audience.

Cons

• Higher Membership Cost: Amazon Prime’s annual fee is higher than Walmart Plus. Higher costs can deter price-sensitive consumers, requiring more strategic advertising to justify the value.
• Complexity of Benefits: Prime offers a range of benefits, from streaming to free shipping, which can be overwhelming for some consumers. Conveying the full range of benefits effectively in advertising can be challenging, potentially leading to diluted messages.

Comparative Advertising Strategies

Walmart Advertising Strategy

• Emphasize Convenience and Savings: Ads should highlight benefits like free same-day delivery from stores and fuel discounts. For example, “Get your groceries and everyday essentials delivered for free the same day. Save on fuel every time you fill up.”
• Target Local Markets: Focus on the advantages of in-store integration and local shopping experiences. Example: “Skip the line with Scan & Go and save time on your weekly shopping.”

Amazon Prime

• Promote Entertainment and Exclusivity: Highlight the extensive streaming library and exclusive deals like Prime Day. For instance, “Stream thousands of movies and shows on Prime Video. Don’t miss out on exclusive Prime Day deals.”
• Leverage Global Appeal: Utilize the broad reach of Amazon Prime to create comprehensive campaigns that appeal to a wide audience. Consider: “Join millions of Prime members worldwide and enjoy benefits tailored just for you.”

Both Walmart Plus and Amazon Prime offer unique advantages and face specific challenges in the context of advertising.

Walmart Plus can capitalize on its strong in-store integration and tangible savings, making it attractive for every day, value-oriented consumers. In contrast, Amazon Prime’s comprehensive entertainment offerings and exclusive events like Prime Day provide powerful tools for broad, engaging advertising campaigns.

By understanding these differences, you can tailor their advertising strategies to leverage the strengths of each platform, ensuring you connect with your target audiences effectively.

Unlocking New Opportunities for Growth

Walmart's acquisition of Vizio presents a wealth of new opportunities for Amazon sellers to expand their reach and engage with potential customers.

With access to Vizio's first-party data on consumer viewing habits and preferences, Walmart can deliver highly targeted advertising experiences that drive conversions, like the competition between Walmart Plus and Amazon Prime.

Take advantage of the changing advertising scene with these clever moves:

• Evaluate your target audience and determine if Walmart's platform aligns with your goals, considering the differences between selling on Walmart vs Amazon.
• Experiment with different ad formats and targeting options to maximize the impact of your campaigns, leveraging the unique features of Walmart ads.
• Collaborate with influencers or content creators to showcase your products in engaging, shoppable videos on Vizio's platform.
• Utilize Walmart's rich consumer insights to refine your product offerings and create bundles or promotions that appeal to your target audience.

To capitalize on these new opportunities, Amazon sellers must be willing to adapt their strategies and embrace change. This requires staying informed about industry developments and being prepared to make data-driven decisions.

Adapting to the Evolving Advertising Landscape

Amazon sellers must remain agile and adapt quickly as Walmart continues to innovate and refine its advertising offerings. By staying informed about industry developments and adjusting your strategies accordingly, you can position yourself for success in the ongoing Walmart vs Amazon rivalry.

Here are some ways to optimize your advertising efforts in light of recent changes:

• Keep a close eye on Walmart's advertising offerings and consider incorporating them into your marketing mix.
• Monitor your advertising performance closely and make data-driven adjustments as needed, considering the nuances of Walmart and Amazon.
• Attend industry conferences, webinars, and workshops to stay current on digital advertising trends and best practices.

For sellers and advertisers, these developments present both challenges and opportunities. 

Potential challenges include increased competition for advertising space and consumer attention, the need to adapt to new ad formats and targeting options, and the potential for higher advertising costs as demand grows.

Opportunities are access to new advertising channels and audiences through connected TV advertising, the ability to leverage advanced personalization and targeting capabilities, and the potential for increased sales and brand awareness through omnichannel advertising.

Predictions on the Future of Digital Advertising

As Walmart and Amazon continue to vie for dominance in the digital advertising space, we can anticipate several key changes in the industry.

The acquisition of Vizio by Walmart is likely to fuel increased investment in connected TV advertising, as both companies seek to capitalize on the growing popularity of streaming services. This could lead to more innovative ad formats and targeting options tailored to the connected TV environment.

Emerging Trends and Potential Shifts in Market Dynamics

One of the most significant emerging trends in digital advertising is the growing importance of omnichannel advertising.

With the lines between online and offline shopping becoming increasingly blurred, Walmart and Amazon may prioritize the development of seamless advertising experiences across various touchpoints. This could involve integrating in-store and online advertising, leveraging location-based targeting, and creating cohesive brand experiences throughout the customer journey.