While Amazon may currently dominate the retail media space, U.S. brands should recognize the potential of Walmart’s retail media. Through its Walmart Connect ads business, Walmart benefits from less competition and offers more sales channels and rich customer data, enabling potentially more effective campaigns. For brands, this can result in a greater return on advertising investment—if you know how to leverage Walmart ads effectively. This guide will show you how to advertise on Walmart, including a deep dive into ad types and our go-to strategies for gaining the most benefit from Walmart retail media.
What is Walmart Connect?
Walmart Connect is Walmart’s rebranded retail media platform, launched in 2021, that has quickly become a significant player in the retail media landscape. In 2022, Walmart reported nearly 30% growth in advertising revenue, and this momentum continued with an additional 30% growth in Q2 2024, outpacing the global ad segment average of 26%.
Walmart Connect leverages enhanced digital capabilities to provide targeted advertising opportunities for both first-party brands and third-party sellers. The platform allows advertisers to reach Walmart customers across multiple channels, including Walmart’s website, mobile app, in-store digital screens, and a network of affiliate sites.
With its compelling multichannel reach and rich source customer data, Walmart Connect is attracting an increasing number of brands, offering a unique opportunity to engage with shoppers both online and in-store.
Two Solid Reasons Why You Should Advertise on Walmart
With Amazon taking the lion’s share of retail media – 77% as compared to Walmart’s 6.8% according to eMarketer – you may be wondering how a much smaller player like Walmart could help your brand.
Walmart’s diversification beyond retail is creating explosive growth for the US’s largest retailer
Walmart has been America’s largest retailer since 1990 and, in 2020, became the second-largest e-commerce retailer in the U.S. This growth is reflected in its impressive e-commerce performance, with U.S. online sales growing by 12% in fiscal year 2023, following a remarkable 79% increase in 2020. Such sustained growth underscores Walmart’s appeal to both customers and advertisers, especially those looking for a comprehensive omnichannel strategy.
A key advantage for Walmart Connect retail media is its unique omnichannel reach: over 90% of the U.S. population lives within a 10-mile radius of a Walmart store. This physical footprint allows advertisers to target customers both online and in-store, a benefit that is unique to Walmart Connect and in part explains its efficacy for retail media.
However, it’s Walmart’s investments beyond strictly retail that make it so compelling for advertisers. In 2024 alone, Walmart plans to invest nearly $14 billion in technology and automation, including expanding its use of artificial intelligence (AI) to further personalize shopping experiences. These technological advancements will enhance the capabilities of Walmart Connect ads, making them an even more effective means for brands seeking to tap into Walmart’s vast customer base while maximizing their ROI.
Amazon Ads vs Walmart Connect Ads: How Walmart provides greater return on retail media
There is less competition on Walmart which results in cheaper ads
With fewer brands vying for attention, the bidding prices for ad placements are generally lower on Walmart, allowing advertisers to achieve greater visibility and engagement at a reduced cost. For example, our recent data showed that Walmart wins across every retail media KPI as compared to Amazon:
- Walmart CPC is 55% lower than Amazon
- Walmart CTR is 3X higher than Amazon
- Walmart ROAS is 25% higher than Amazon
The bottom line is that with Walmart, you can reach your target audience without the higher costs often seen on Amazon’s more saturated platform.
Walmart has no setup fees or 3rd party seller charges
Unlike Amazon, which imposes various setup fees and charges for third-party sellers, Walmart offers a more straightforward and cost-effective advertising option. By eliminating these extra costs, Walmart allows you to allocate more of your budget directly to your ad spend, rather than to ancillary fees.
Walmart has physical stores which means online ads can fuel in-store sales
Unlike Amazon, which imposes various setup fees and charges for third-party sellers, Walmart offers a more straightforward and cost-effective advertising option. By eliminating these extra costs, Walmart allows you to allocate more of your budget directly to your ad spend, rather than to ancillary fees.
Walmart has affiliate sites which means you can reach multiple sales channels through one ad platform
Walmart’s expansive affiliate network includes various websites and partnerships such as shoes.com and Moosejaw.com that extend the reach of Walmart ads beyond its primary site. Advertisers can efficiently tap into a broader market, maximizing exposure and potential conversions without the need for multiple, fragmented campaigns. This consolidated approach simplifies the ad process and increases the effectiveness of each ad dollar spent.
Walmart is increasing its number of sales events to compete with Amazon
To better compete with Amazon, Walmart has been ramping up its number of sales events throughout the year, most recently around Prime Day with its Walmart Deal Days. These events attract a surge of consumer interest and traffic, and for you, an opportunity to capitalize on the shopping frenzy. As on Amazon, you can optimize your retail media campaigns around sales events on Walmart to benefit from the increased visibility and conversion rates during these peak periods.
Walmart Connect Ad Types Explained
Walmart supports several ad types which you can use concurrently to increase visibility of your brand throughout each stage of the path to purchase.
Sponsored Search Ads
These are keyword-based ads that appear in Walmart’s search results when customers search for specific products or categories. Sponsored Search Ads are pay-per-click (PPC), meaning you pay only when a shopper clicks on your ad. There are three types of Sponsored Search Ads:
Walmart Sponsored Products
Walmart Sponsored Products are ads that promote individual products. They can appear in the search grid, in a product carousel, or under the buy box of an individual product page. They’re a great way to increase visibility on specific items throughout the buyer journey, even as shoppers research competing products. Sponsored Products are eligible to all Walmart Connect advertisers.
Walmart Sponsored Brands
Walmart Sponsored Brands is Walmart Connect’s premium keyword-targeted search ads placement format designed to showcase your brand logos and curated products to shoppers actively searching for similar items. They’re a great way to reach users at the start of their shopping journey, as they can grab the shopper’s attention as they begin their search. Brands have seen on average a 30% higher conversation rate for Sponsored Products when combined with Sponsored Brands. To be eligible for Sponsored Brands, you need to be a registered brand owner.
Walmart Sponsored Videos
Walmart Sponsored Videos are premium keyword-targeted video ads promoting a single item within relevant Search In-grid results. 60% of Sponsored Videos on Walmart are from new-to-brand customers, making them a powerful way to improve product awareness and consideration around new product lines and seasonal items.
Walmart Display Ads
Walmart supports various display ad types designed to reach shoppers across the funnel.
Onsite Display Ads
Walmart’s Onsite Display ads include:
- Homepage Feature Ads and Gallery Ads that put your brand front and center when shoppers visit Walmart.com or the Walmart app homepage
- Category Takeover Ads that prominently showcase your brand in relevant category and search pages
- Custom Brand Pages allow you to create a curated brand presence that can be used in conjunction with other Display Ads to educate shoppers about your products
For example, a search for “perfume for women” resulted in this Display Ad for Victoria Secret which leads shoppers to the Victoria Secret brand store where shoppers can explore the brand’s perfumes, mists, lotions and more.
Offsite Display Ads with Walmart DSP
Walmart Connect goes beyond Walmart with its Demand Side Platform (DSP) which brings together Walmart’s immense amount of first-party data such as behavioral attributes and customer cues (How old are they? What brands do they buy? Where do they live?). Walmart DSP allows you to target shoppers on channels outside of the Walmart app or website, including audio streaming apps, CTV, gaming apps, and social media. Walmart DSP is a great way to expand your visibility beyond Walmart and is particularly useful for targeting lapsed buyers who may have forgotten about your brand.
In-Store Display Ads
Walmart currently has 4,606 brick-and-mortar stores across the U.S. Walmart’s In-Store Display Ads include on TV screens, self-checkout ads, interactive product demos, in-store audio ads, or trial samples for pickup and delivery orders. Combine In-Store Ads with Onsite Display and Sponsored Search Ads to reach shoppers at their point of purchase.
How to Advertise on Walmart Marketplace – 4 Winning Strategies for High Return Retail Media with Walmart Connect
As mentioned above, Walmart ads operate on a pay-per-click (PPC) model, which means you only pay for ads that are clicked on by shoppers. The cost is determined by keyword bidding, where you set a maximum amount you’re willing to spend on a keyword to gain visibility. So, how do you set your budget for keywords and ensure you’re winning prime real estate on Walmart without overspending? Here’s how…
Walmart budget allocation – start small
Begin with a conservative budget to test and learn which strategies and keywords perform best on Walmart Connect. Starting small allows you to collect data and refine your strategy without overspending. Pacvue can support this with budget management tools to automate and optimize your ad spend across various campaigns, including dynamic budgeting so you can allocate spend on your highest performing campaigns. The key is to gradually increase your budget as you identify high-performing keywords and ads.
Research competitors’ ad strategies on Walmart
Walmart may be less competitive than Amazon, but it still pays to do your research on other brands bidding on the same keywords you are. Pacvue’s competitive intelligence features can analyze your competitors’ ad strategies, including their keyword bids, product targeting, and rankings. This allows you to spot the gaps, e.g. keywords they aren’t bidding on. Remember, since competition for Walmart advertising is lower than on Amazon, you can make your ad spend go further.
Prioritize keywords
You ultimately want keywords with high volume, high conversion, and low competition. Pacvue’s keyword research tools can help identify keywords that meet these criteria and are relevant to your products, providing insights to help you bid strategically, balancing cost and expected return. Pacvue’s automation can dynamically optimize your bids, ensuring you remain competitive without overspending on less effective keywords.
Test ad formats
Testing different ad formats, be it Display Ads or Sponsored Search, is key to discovering what resonates most with your target audience and leads shoppers to purchase. Pacvue’s Managed Services Team can help recommend Walmart Connect ads for A/B split testing. Analyze the performance of each format to refine your strategy, focusing on the ads that drive the highest engagement and conversion rates.
Recent innovations in Walmart Connect Ads
Walmart has been continuously innovating its ad offerings to stay competitive in the retail media landscape. Here are some of the recent advancements that highlight how Walmart is evolving to attract more advertisers and enhance its ad capabilities:
Brand term targeting
Walmart Connect introduced brand term targeting in early 2024 to help advertisers capitalize on brand-specific searches. This innovation allows brands to bid on their own brand names or on competitors’ brand terms, helping you capture shoppers who are actively searching for other brands in your category. You can now bid against these competitors with relevant content, offering shoppers a tempting alternative to the brand they may have been searching for. Brand term targeting is a powerful way to reach new-to-brand consumers who are close to making a purchase decision. Learn more about how to use brand term targeting to increase visibility.
Integration with Disney’s streaming platforms
Walmart Connect has partnered with Disney to link shopper data with streaming audiences, leveraging Disney’s advanced advertising capabilities and extensive viewer reach. This offers a unique opportunity to connect your ads with Disney’s audience segments, including those on Disney+, Hulu, and ESPN+. Again, this channel taps into Walmart’s rich shopper data, aligning it with streaming behaviors so you can deliver highly targeted and relevant ads. This cross-platform integration demonstrates Walmart’s commitment to blending retail media with broader digital advertising landscapes, expanding opportunities for brands to reach diverse audiences.
Acquisition of VIZIO for enhanced consumer insights
Walmart recently acquired VIZIO and its SmartCast Operating System which furthers Walmart’s expanse into the home entertainment space and expands on its existing wealth of customer data. With Vizio’s extensive connected TV footprint, Walmart now has access to a whole new segment of consumer insights that can be used to better understand viewer preferences, behaviors, and purchasing patterns. For advertisers, this acquisition means more refined audience segments and better performance measurement, leading to higher ROI on ad spend.
Walmart’s AI-powered creative tools for retail media
Walmart is actively expanding its self-serve solutions to support advertisers with retail media. This includes Creative Builder, a machine-learning-powered tool for building and optimizing ads. This innovation continues to make Walmart Connect an appealing platform for advertisers looking to experiment with retail media in a cost-effective and efficient way.
It’s Time to Make Walmart Connect Ads the Next Action on Your Priority List
Walmart Connect ads offer an exciting and rapidly growing platform for advertisers looking to maximize their return on retail media. With less competition, lower costs, and unique omnichannel capabilities, Walmart provides a compelling alternative to Amazon for brands seeking to engage a vast and diverse audience. Walmart’s significant investments in technology, AI, and partnerships, combined with its unique physical footprint and expanding range of advertising options, make it a compelling alternative to Amazon for retail media ad spend.
Now is the time for your brand to take advantage of Walmart’s evolving ecosystem. By leveraging Walmart Connect’s innovative ad formats, tools, and strategies—like starting with a smart budget, conducting competitive research, prioritizing high-performing keywords, and testing various ad formats—you can drive impactful campaigns that reach customers both online and in-store.
To learn more about how to take advantage of everything Walmart Connect advertising has to offer, check out our recent conversation with the Walmart Connect team about Walmart Onsite Display.
