Commentary

What We Can Learn From Walmart's Offline Strategies

by Jeremy Ozen , January 15, 2015

Walmart could be the sleeping giant of ad tech. There, I said it. If you missed previous reports, Walmart Labs has been quietly acquiring all forms of technology companies. In fact, it now employ 3,500 people, which is more than half of Facebook’s 6,337 employees.

It actually shouldn’t be a surprise that a company like Walmart is getting into ad technology. Retailers, and Walmart in particular, have always been data-driven companies. Sam Walton used to fly around scouting out new store sites, which was a novel approach at the time.

With its Walmart Exchange platform, the company is focusing on leveraging its consumer insights and data to help drive in-store sales. Let’s not forget, 95% of retail purchases still happen inside a store. So it’s refreshing to see Walmart put its programmatic capabilities to work in a way that will drive real-world purchases and revenue.

One of the shortfalls of programmatic has been its focus on driving online conversions. There are only so many cookies to retarget and try to drive to an e-commerce page. The future of programmatic, where we will be able to see tremendous growth, is in leveraging data and analytics to drive real world-conversions (like Walmart is doing) – be it foot traffic to a retailer or purchases in a store.

That being said, tracking offline consumer behavior to inform online targeting and then turning it all around to understand offline ROI is no simple task. However, the tools are there. We must start weaning ourselves off the easy road where we judge programmatic success via higher click-through rates. Walmart probably knows a thing or two about driving sales – it did a mere $473 billion of revenue in its last fiscal year. Given its astounding success as a retailer, maybe we should consider taking a page out of Walmart’s book when it comes to our future programmatic strategies as well.

programmatic, rtb

3 comments about "What We Can Learn From Walmart's Offline Strategies".

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Jonathan Hutter from Northern Light Health, January 15, 2015 at 1:22 p.m.
Well said. You'd be crazy not to keep your eye on what Walmart Labs is up to over the coming months and years. Among Walmart, Facebook, Google and Amazon, their ultimate goal is world domination (at least your world). Only Walmart has the bricks and mortar part down. We'll see who gets closest first.
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David Carlick from Carlick, January 15, 2015 at 1:32 p.m.

I was on a DOOH panel some time back with two people from WalMart. Their story was fascinating. They had replaced all the PRN network screens around the store that were running, basically, brand ads, mostly repurposed TV. They found no one was looking at them, and they didn't drive trial or sales. So they went to three TV 'areas:' A greeter screen that flashed specials, the wall of TVs in the electronics area, that ran specials and product ads, and eye-level end-cap smaller TVs that ran product demonstrations specific to things in that very aisle. They showed a pet hair wand (couch before, couch after, happy pet, happy owner, animation of hair capturing technology, etc.) and a toothpaste (demo of scrubbing technology working around gumlines and between teeth, as I recall). The coolest part was that they could do holdout samples, aisles where they did not run the promos, and then track exposed/unexposed at the cash register. Obviously, there is also the ability for A/B testing.

Oscar Padilla from Luminar, January 16, 2015 at 2:33 p.m.

What a great article. Jonathan is right on his comment. Walmart's massive transactional data (online and offline) really give them the ability to own programmatic.