Why Walmart is the New Darling of Third-Party Marketplace Sellers

Move over, Amazon—there’s a new retail media advertiser stealing the spotlight among third-party marketplace sellers. Walmart just posted a jaw-dropping 26% growth in Q2 2024, and it’s all thanks to Walmart Connect. 

Since the pandemic shook up the retail scene, Walmart stepped up its game, trading grocery aisles for digital dominance. Forget being just a place for t-shirts and groceries—Walmart’s now going head-to-head with Amazon in the digital ad space. 

But what’s behind this big win? How is Walmart pulling off one victory after another in a market ruled by giants? Let’s crack open Walmart Connect’s playbook and see what’s turning this retail heavyweight into a digital ad powerhouse! 

The success of Walmart’s advertising business has shown its true colors in 2024  

Back in 2021, amid a pandemic that made everyone a bit stir-crazy, Walmart decided to do more than just stock up on toilet paper—they launched Walmart Connect. This was their bold new play to connect their massive customer base of 150 million with sellers and suppliers, and they did it all online. Fast forward to now, and this move is paying off big time. 

In less than three years, Walmart Connect has gone from “just an idea” to “Whoa, this is huge.” With a jaw-dropping 30% year-over-year growth in just one quarter, it’s clear that Walmart’s ad business isn’t just cruising; it’s zooming down the fast lane.  

Walmart’s massive gain in the retail advertising world comes down to two super-practical reasons. First, Walmart is sitting on a goldmine of first-party shopper data—thanks to loyalty cards and memberships, it knows what you like before you do. Second, Walmart can splash ads literally everywhere—TV, radio, websites, social media, and even streaming channels. 

This means that Walmart can charge advertisers (especially third-party marketplace sellers) to laser-focus their ads and target customers with mind-blowing precision. It’s like having the ultimate GPS for shoppers. 

In Q1 of 2024, Walmart Connect reported a 19 percent increase in active advertisers count, and now, in Q2 of 2024, ad revenue from third-party marketplace sellers increased by nearly 50% year-over-year during the quarter. 

According to research firm eMarketer, Walmart is set to continue its impressive ascent in the retail media landscape while Amazon maintains its dominant position. However, Walmart is rapidly closing the gap. eMarketer predicts that Walmart will capture 6.8% of U.S. retail media spending in 2024. This translates to an estimated $3.7 billion ad revenue for the retail giant.   

Walmart’s secret weapon for the ad revenue growth is third-party marketplace sellers

Walmart’s secret to success isn’t just its crazy low prices or endless shelves of goods—it’s the third-party marketplace sellers driving its 26% growth in ad revenue. But wait—why are these sellers jumping ship from Amazon and sailing over to Walmart Connect? 

Here’s the scoop: Walmart has always been a powerhouse for its own products, but now, its marketplace is the go-to spot for over 100,000 active sellers. The reason? Walmart’s platform offers way less competition compared to Amazon, making it the perfect playground for small and medium-sized businesses. Plus, who wouldn’t want a shot at landing their products on Walmart’s actual shelves at offline stores? 

But that’s not all. Walmart Marketplace does something genius—third-party sellers get their ads right next to their products. It’s seamless, user-friendly, and basically a dream come true for businesses trying to expand their reach. Walmart Connect has made listing, pricing, and selling as easy as pie, giving sellers the boost they need without getting drowned in Amazon’s sea of competition. It’s a win-win. 

Walmart aims for streaming channels, new partners, and promising plans for advertising business  

In its latest power move, Walmart inked a pact with Disney+ to push itself deep into the streaming wars. Yep, the same Walmart that once just sold DVDs is now in cahoots with Disney+ and Hulu! What’s the strategy? Leverage Walmart Connect’s first-party data to turbo-charge ad campaigns across streaming platforms, making sure consumers get hyper-targeted ads that feel more like personal recommendations than random pop-ups. 

But wait, there’s more. Walmart didn’t just stop at a streaming partnership—it went ahead and bought Vizio, the TV maker, for a cool $2.3 billion. The retail giant’s acquisition of Vizio hands Walmart the reins to over 20% of the U.S. TV market. With more than 18 million active accounts (that’s a whopping 400% growth since 2018), Walmart now has direct access to millions of screens.  

Walmart’s ambitions don’t stop there. It’s also expanding beyond its usual retail suspects to target businesses in sectors like automotive and financial services. The goal? To attract a broader range of advertisers who are looking for that next big marketing win. 

By integrating precision tools for third-party marketplace sellers and partnering with huge names like Disney+, Walmart is cooking up some serious advertising magic. It’s taking the ad world by storm and giving Amazon a run for its money—literally! So, whether you’re a casual shopper or a small business, Walmart is making sure its Connect platform has something up its sleeve to grab your attention. Talk about next-level retail domination! 

Cut to the chase 

Walmart is looking ahead with its winning retail advertising business and strategic moves like partnerships with Disney+ and acquisitions like Vizio. The company’s ability to leverage its first-party data and offer a seamless advertising platform for third-party sellers is proving to be a game-changer.