Walmart is best known for its brick-and-mortar stores, but Walmart is hoping to diversify away from relying on most of its income coming from there.
Recently Walmart has been pushing hard to offer eCommerce options to diversify. Now Walmart also hopes that its ad business will become a major part of Walmart over the next five years.
“Today, the vast majority of our overall profits are attributable to in-store brick-and-mortar in the U.S.,” John David Rainey, Walmart’s CFO, said at a Raymond James Conference. “If you fast forward five years, we are much less dependent on that as an income stream than some of these other faster-growing parts of our business.”
Walmart is hoping to build an advertising model similar to what Amazon has done. Recently Amazon announced that it had $11.6 billion in revenue from its ad business in the fourth quarter of 2022.
Now Walmart is hoping that selling ads in stores, on its website, and through its app will see similar results. Walmart already saw a 30% jump in ad sales in 2022. In the 4th quarter of 2022, Walmart reported a 41% year-over-year jump in ad sales.
Walmart also wants to take on Amazon online. Right now, Walmart offers over 400 million products on Walmart.com and hopes to grow its partnerships with 3rd party sellers in the years to come.
The question now is will Walmart beable to see its ad and eCommerce efforts become as successful as they want.