Walmart’s ad business goes from strength to strength | WARC | The Feed
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Walmart’s ad business goes from strength to strength
Walmart’s global ad business grew by 28% during 2023 to reach $3.4bn, and is expected to account for an increasing proportion of revenues in the year ahead.
“We believe global advertising and membership alone will represent 20% of annual operating income in FY 2025,“ CEO Doug McMillon told an earnings call.
Why Walmart's ad business matters
Walmart is effectively replicating the Amazon flywheel idea. “Marketplace is an engine for our business,” McMillon explained: it brings in more sellers and is driving e-commerce for the retailer outside the US. “That growth helps us drive our global ad business.” The biggest financial gains are currently evident in the US and India (from Flipkart). “But as these businesses scale in places like Mexico and Canada, we expect to see a similar relationship,” McMillon added.
Takeaways
- In Q4, global advertising grew approximately 33%, led by internationals’ 76% growth.
- Internationals’ growth benefited from the timing of Flipkart’s Big Billion Days sales in India, but still delivered full year growth of about 30%.
- Walmart US Connect ad sales grew 22% with more than 50% growth from Marketplace sellers.
- Sam's ad business reached a new high with almost 50% more advertisers than a year earlier.
- Walmart reported “strong demand from new advertisers as active advertiser counts increased over 20%”.
The Vizio opportunity
The recent acquisition of smart TV maker Vizio “gives us the opportunity to reach and serve customers in new ways and connect more dots for those that advertise with us”, McMillon told the earnings call. “This acquisition accelerates the buildout of our advertising platform into the connected TV business, which will be exciting.”
Sourced from Seeking Alpha, Walmart
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