The efforts are key to Walmart’s aggressive plan to grow its
advertising business by more than 10 times within the next five years,
according to a source familiar with the matter.
Reuters previously reported Walmart’s annual advertising
revenues were expected to be nearly $1 billion in 2020.
The Bentonville, Arkansas-based company, with nearly 5,000
stores nationwide, has set a goal to become one of the top 10 advertising
platforms in the United States within the next five years, a “slightly
conservative,” goal, the source said.
Walmart has expanded its advertising business after years of
stuttering progress, even as a deal to buy a 7.5% stake in video-sharing app TikTok
remains in limbo.
Walmart refocused its strategy starting in early 2019,
cutting ties with its external advertising partner and taking the business
in-house as Walmart Media Group. Now, it will be named Walmart Connect, the
company said.
“This is about us really digging in and pivoting the
business from one which was really focused on search and display with our
biggest suppliers,” Walmart’s chief customer officer Janey Whiteside told
Reuters. “We want to continue to do that, leverage our physical properties, and
find ways to help advertisers make better use of their dollars.”
Walmart said it will build a new advertising platform in
partnership with ad technology company Trade Desk Inc. It will allow brands to
use Walmart’s ample shopper data to make ads more effective, even on websites
and apps Walmart does not own.
Brands will be able to target ads to audiences using
Walmart’s data on shopping behavior across categories and brands. Advertisers
can then monitor sales inside Walmart stores in real-time and adjust ad
campaigns as needed, Whiteside said.
Accurately measuring whether an ad led to a purchase has
been a long-term technological challenge. Walmart is betting that allowing
brands to use its data on ads across streaming video or smart TVs will draw in
more ad dollars.
The retailer said it will take advantage of its
brick-and-mortar stores to compete with online retailer Amazon, and will sell
ads on over 170,000 screens inside more than 4,500 U.S. stores, including on
TVs and screens of self-checkout kiosks.
“We have this unparalleled source of data that we can bring
to bear,” Whiteside said. “Who else can actually tell you if a customer saw
something online and then a week later, physically bought it in the store?”