I’ve always been fascinated by the potential of marketing for a bank, a telco, or a retailer. Why? Because of the data they possess. I’m sure you’ve heard the old joke: ‘50% of my advertising spend is wasted. I just don’t know which 50%.’ However, that’s no longer the case for media networks that gather information from a variety of sources, such as in the case of Walmart—including online behavior, in-store behavior, and now TV information. With all these data points, it’s now possible to measure absolutely everything.
For those of us who closely follow the evolutions and revolutions in media technology, Walmart’s announcement of purchasing Vizio for a sum of $2.3 billion is, in my opinion, a brilliant maneuver.
Before continuing with my post, it’s worth mentioning for those who may not be familiar, all of this serves to bolster Walmart Connect, its advertising media business previously known as Walmart Media. A significant strength they possess as a retail business is their ability to correlate online and in-store activity. This closed-loop system offers a comprehensive view of Walmart customer behavior and creates accountable, measurable results for their suppliers.
It was only a matter of time before Walmart started to build on this business since they have all the information and behavior of their customers, which is also more profitable than their other business verticals; this acquisition is the icing on the cake.
Vizio, though it may not resonate as much outside the United States, is a giant in its field, specializing in televisions, sound bars, and most crucially in this equation: advertising and viewer data. Founded in 2002 and based in Irvine, California, Vizio has been a preferred brand in many American homes, which speaks to its solidity and popularity.
In my view, this acquisition signals Walmart’s ambition to expand beyond traditional retail. By entering the media and advertising realm, Walmart aims to emulate Amazon’s success. With a company now present in countless living rooms through TVs and streaming, Walmart is strategically positioned to develop its Connected TV business.
Let’s be real: around the world, TV advertising has notoriously had a transparency problem. But it has become easier in developed or first-world markets to rise above those limitations with connected TV, which unifies brand marketing and performance marketing tactics together to provide crystal-clear clarity into the outcomes of TV campaigns, something that will eventually come to more lagging markets like Latin America, where many still rely on questionable studies or reports to make investment decisions.
Why is Walmart Betting on Vizio?
The answer seems straightforward to me: advertising. Vizio knows what customers watch. Walmart knows what they buy. With the acquisition, Walmart can combine that data to make advertisements more personalized and effective.
Vizio TVs include automatic content recognition technology, which allows the company to understand a customer’s streaming preferences. For example, if Vizio knows that a certain user watches gaming content and plays PS5 for an average of 2 hours each night, and also knows that they usually buy snacks in the store, now Walmart’s DSP can dispatch in milliseconds an ad for Doritos or a certain brand of energy drink to power through more gaming time.
This acquisition presents a valuable opportunity for Walmart to connect with consumers during their leisure time, potentially influencing future purchases. Some analysts believe this move will enhance Walmart’s advertising efforts in streaming TV, potentially positioning the company favorably in the streaming industry, especially if it pursues its own streaming service.
A Bright Advertising Future
I believe the acquisition of Vizio brings a bright future for advertising at Walmart. With more than 18 million active accounts on Vizio’s Smart TV system, SmartCast, Walmart gains a new avenue to advertise directly to households. This not only expands Walmart’s advertising reach but also enables the creation of exclusive entertainment experiences for Vizio users. I am convinced that this strategy provides Walmart with a notable edge in the competitive advertising landscape, putting it on par with industry giants like Amazon.
Diversification and Strategy
In my opinion, Walmart’s acquisition of Vizio signifies a strategic move to diversify its business and tap into the lucrative advertising sector. This acquisition not only expands Walmart’s advertising capabilities, including in-store ads and product demonstrations, but also positions it for growth in TV advertising through streaming services. I believe this integration could greatly enhance seller visibility on Walmart’s platform, contributing to the significant growth in advertising revenue seen in recent years.
Walmart’s CFO describes the acquisition as an “accelerant” to their advertising efforts, and I agree that it will greatly boost their advertising strategy. If the acquisition passes regulatory hurdles, Walmart stands to benefit from a lucrative data and advertising business, strengthening its position as a competitor to Amazon in both the Connected TV and retail media landscapes.
You can read more about this deal on Walmart’s official press release.
Stay hungry,
Jose Guzmán, an award-winning marketer with 15+ years’ experience, combines his passion for tech and innovation to drive revenue growth and market expansion. With a rich academic background and numerous honors in marketing, he’s deeply committed to continuous learning. In this blog, Jose shares the latest marketing trends, tips, and strategies, inspiring readers to #StayHungry for knowledge.
