Dive Brief:

• Walmart Connect, the retailer’s U.S. advertising division, is expanding its overtures to marketplace sellers and non-endemic brands as part of its growth roadmap for 2024, according to a blog post by Senior Vice President and General Manager Rich Lehrfeld.  
• Marketplace sellers, or smaller brands using Walmart, are gaining access to on-site display advertising through the company’s self-service ad platform beginning this month. The advertiser category is now Walmart Connect’s fastest-growing after spending on sponsored search grew by 63% last year. 
• At the same time, Walmart Connect is beginning to offer offsite media to a selection of non-endemic advertisers, or businesses that do not sell through Walmart. Those include automotive, entertainment, financial services, quick-service restaurant and travel companies.

Dive Insight:

Coming off a strong year, Walmart Connect is looking to widen the pool of its advertiser base. The unit is expanding the variety of programmatic ad products available to marketplace brands via its self-service platform, along with courting more non-endemic and international brands into the fold. 

Self-service advertising can help retail media networks achieve greater scale, welcoming more small- and mid-sized advertisers that find managed services too pricey. Extending on-site display to marketplace sellers for the first time seeks to build on momentum in search, which has made the marketplace category Walmart Connect’s fastest-growing. The move also speaks to the increasing importance of programmatic in retail media. Lehrfeld said display ads on Walmart properties are becoming “primarily programmatic and auction based.”

Some scrutiny has been cast on retail media networks’ programmatic practices after reports that the sector runs a heavy amount of ads on Made for Advertising sites, or low-value clickbait farms. A wide-ranging report from Adalytics on the prevalence of MFAs found Walmart Connect did not transact on them.

Non-endemic advertising is another emergent competitive front for retail media networks that want to prove their first-party data know-how is valuable to brands that sell outside of their ecosystems. Walmart Connect is additionally rolling out localized self-service support tools and educational resources to help international brands reach customers in the U.S.

Walmart has made several moves to hone the appeal of its retail media network, which competes against other retailer offerings, such as Target’s Roundel, and Amazon for brand dollars. The big-box store in February acquired Vizio for $2.3 billion, a deal that includes the smart TV maker’s ad solutions and a rich set of data that many advertisers rely on for media planning and buying.

Walmart Connect is also broadening its in-store demo stations and sampling, part of a renewed focus on leveraging physical retail to support advertising. On that front, Walmart Connect said it is implementing in-store campaign management tools as a self-service capability, beginning with TV wall advertising.

Turning toward digital channels, Walmart Connect is making media partnerships with Roku and TikTok accessible to more advertisers following a pilot period. To help address signal loss, the group is deepening its targeting, conversion and measurement bench. In-store attribution for search campaigns and brand-term targeting in search are some of the ways Walmart Connect is trying to improve its sophistication in these areas. 

Lastly, Walmart Connect is pushing to refine its creative tools to help marketers better realize their omnichannel efforts. The announcement teased more self-service offerings coming down the pike, including video additions, and a Creative Builder platform that applies machine learning to help brands develop and optimize creative assets for advertising.

Walmart Connect saw revenue up 22% in Q4, an important window that includes the holiday sales period. Full-year revenue for the division increased by 30% while Walmart’s global ad business reached $3.4 billion.