Making the Most of Walmart’s Self-Serve Ads

This year, Walmart launched its self-serve ad portal, which helps marketers easily launch search and sponsored ads on the retailer’s e-commerce site. The launch solidifies Walmart's move into the advertising space, as it seeks to keep up with the big three digital advertisers: Amazon.com, Facebook, and Google. For marketers seeking to diversify promotions across channels, testing Walmart ads could result in new customer acquisition and revenue gains.

Increasing Advertising Capabilities

Last year, Amazon's advertising business generated $9.8 billion in revenue. In addition, retail chains that sell primarily through brick-and-mortar stores grew web sales by 16.1 percent. Walmart and Target both looked to capitalize on these trends by offering alternatives to Amazon.

Walmart announced its acquisition of Polymorph, which delivers ad self-serve and bidding capabilities, in April of last year. The move has helped Walmart offer an ad platform that's less complicated to use, increases ad relevancy, automates delivery systems, and measures results.

The Advantage of Walmart’s Self-Serve Ads

The goal of Walmart’s self-serve ads is to boost marketers’ ability to focus ads to targeted customers at a specific time, based on each shopper’s behavior. Advertisers can analyze how ads impact sales and determine how campaigns benefit their bottom lines.

Currently, Walmart offers an expansive audience. Ninety percent of Americans shop at Walmart each year, and the retailer receives a total of 160 million visitors each week to its brick-and-mortar stores and e-commerce site.

Walmart has sweetened the advertising deal by launching third-party API integrations, which help advertisers that are looking to scale Walmart advertising accounts in the long term. Marketers can initiate and control ads with more accuracy, use artificial intelligence (AI) to automate campaigns and generally make the most of sponsored ads. In addition, these APIs allow companies to work with external agencies to launch and test ads on Walmart, as well as tie Walmart results to campaigns across digital marketing channels.

Walmart’s Advertising Future Will Be Rich

Overall, Walmart is positioning itself to become a much larger advertising player in the coming decade. This growth will be possible because Walmart’s e-commerce strategy attracts a more diverse shopper than its stores typically do. In addition, it has a sizable advantage in terms of distribution possibilities, especially because it offers in-store pickup and two-hour local delivery, thanks to its partnership with Deliverr.

Walmart’s biggest differentiation against Amazon is its physical footprint. Walmart has years of experience in the offline world, with a wealth of customers who have used Walmart’s omnichannel platforms. Therefore, Walmart offers a bridge for marketers to connect in-store trends to online, while gaining a more accurate picture of return on investment.

Additionally, there's far more potential for Walmart due to less competition from other sellers. The ratio of monthly visitors to sellers is vastly different: on Amazon, you’re looking at a few thousand customer visits per seller, whereas on Walmart, you’re potentially looking at tens of thousands of customer visits per seller. Walmart is also less saturated with advertisers than Amazon. Only 1.6 percent of sellers are currently advertising on Walmart, according to Teikametrics, making it an attractive option for new advertisers.

As Walmart continues to expand its capabilities, retailers should test, record and analyze performance of sponsored ads. Ideally, marketers will spread out ad buys across multiple channels, which helps them identify the highest conversion rates and maximum ROI. For example, if a retailer already has a paid Amazon strategy, it may be helpful to add Walmart ads to the mix to diversify ad dollars and strategy.

Making the Most of Ads Across Channels

A strong advertising strategy is one that makes the most of the entire digital spectrum. Now is the time to test the waters and identify how Walmart’s ad platform fits into a strong digital advertising mix. We recommend starting small with one or two campaigns, especially since Walmart’s ad platform is still evolving and the capabilities to optimize many campaigns at scale is lacking. We expect the retail behemoth to continue to improve tools and processes, ensuring the success of each campaign for advertisers and customers alike.

Laura Russell is the director of strategy at Adlucent, a performance advertising and analytics agency for large brands and retailers, where she works closely with clients to tackle their business and marketing challenges, advising on how to best leverage data, audiences, and media tactics to drive measurable results.