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Here’s how Walmart is persuading advertisers to hop into its shopping cart

Walmart has been opening its site to more display ads that splash across its homepage and within search results, and it also connects the marketers to sites outside of Walmart. Before the pandemic, Walmart had 12 million visitors to its website each day, according to the pitch deck. The company has long said it attracts a combined 160 million consumers to its stores and website weekly. The deck also says Walmart’s site serves 16 million search queries a day, an important statistic because search is one of the main areas brands can place ads on Walmart.com.

“Walmart’s web traffic has increased 20% since May,” says one ad exec says, speaking on condition of anonymity because this person was not authorized to discuss Walmart’s advertising business.

Walmart is still just figuring out how to make its mark with digital advertising, and is not quite up to the sophistication of its larger rivals like Amazon and Google. “Display ads and other formats are starting to gain some traction but haven’t hit their critical mass yet,” says the advertising executive.

Walmart declined to comment for this story.

Walmart touts a growing marketing program with API partners—technology companies that plug into its Application Programming Interface to develop media buying tools, similar to how they work with Amazon, Google, Facebook and others. Walmart works with a tight roster of firms, including Flywheel, Pacvue, Kenshoo and Teikametrics.

Last month, Walmart announced a major store redesign coming to 1,000 of its 4,700 locations by the end of 2021. The new-look stores will integrate with the Walmart app. Walmart is developing its ad platform in a way that takes advantage of the app, the website and the stores. The pitch deck highlights all the possible ad placements that include “in-store” experiences.

Also last month, the retail giant launched Walmart+, a membership rewards program that competes with Amazon Prime and costs $98 a year.

Walmart is using its first-party data, the kind it collects from consumers shopping on the site, to target ads based on “behavior.” In the deck, Walmart claims ads targeted by “purchase-based” data are three times more effective than other targeting methods. The ads are based on the consumer’s prior interests, rather than simply relying on the context of a search.

As an example, Walmart shows how it could deliver an ad for, say, power tools, even when the shopper is searching for hair care products.

Walmart’s media platform can buy ads outside Walmart.com, too, on properties like Facebook, Google and Pinterest. Walmart calls those offsite campaigns “closed loop display” ads.

Walmart raised eyebrows this summer when it became an unlikely bidder in the sales war over TikTok, the Chinese-owned social video app with close to 100 million users in the U.S. The sales process may have stalled, but that doesn’t mean Walmart won’t look for strategic partnerships with either TikTok or other hot social media sites.

For Walmart the allure of TikTok very much lies in the way it could be used to expand the colliding worlds of e-commerce and social media.

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