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Word on Walmart – April 2021

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Walmart Marketplace Expands to International Sellers

In a big shift away from the current policy of American businesses being the only suppliers found on Walmart’s Marketplace, the retail giant announced it has opened its door to international vendors. This is seen as direct competition to Amazon’s Marketplace where nearly 40% of all sales in the U.S. are from Chinese merchants. Vendors will no longer need to have a U.S. headquarters or business tax identification number to apply to Walmart Marketplace. Currently, Walmart’s Marketplace accounts for only a fraction of total sales (in store, grocery pickup and 1P dot-com sales still reign), but this news shows Walmart’s intent to tap into Asian markets and focus on strengthening its Marketplace offer.

Our Take on the Opportunities

  • Walmart’s clear focus on expanding and growing its Marketplace will lead to tighter competition for suppliers already engaging with the retailer. Brands must look to ensure content, supply chain and advertising opportunities are strategically set to win against incoming brands onsite.
  • Suppliers should also consider a hybrid approach to Walmart if only selling store-shared items onsite. This allows for greater flexibility, exclusivity, e-commerce-friendly pack sizing and control of assortment and pricing onsite.
  • As an international seller, being first and fast to apply for vetting could make all the difference in ensuring your brand is accepted. Having an existing footprint in the U.S. with proven e-commerce experience and ability to deliver on fast shipping will be key to being successful with Walmart.

Source: Bloomberg, Forbes, Walmart

Social Commerce: Walmart’s New Plan to Use TikTok for Beauty

After Walmart’s wildly successful first shop-along livestream event on TikTok aired in December, the excitement around the possibilities within the social media platform has only grown. After reporting growth in TikTok followers by 25% and 7 times higher engagement rate than anticipated, Walmart was quick to air another 60-minute event this March where viewers could purchase the items being showcased directly from the TikTok app. Private label and branded beauty products were the focus of this event, aimed at emulating and creating internet trends for younger audiences. This innovative way to connect with new shoppers allows Walmart to get immediate feedback and interaction from Gen Z and millennial consumers and continue to explore what is possible through social commerce.

Our Take on the Opportunities

  • The ability to make in-app purchases on TikTok and the strategies to interact with broader audiences on social platforms are still in their infancy. Brands and retailers need to be focused on ways to tap into trending topics and have the flexibility to explore social commerce opportunities.
  • Walmart has not yet announced ways for brands to advertise on TikTok through Walmart Media Group, however with multiple successful streaming events under its belt, it can be speculated there will be future opportunities for brands to invest and participate in. Consider testing social commerce opportunities to learn now and ensure your brand’s media strategies are looking ahead for ways to tap into social media opportunities that are exploding onto the scene.

Sources: Walmart Corporate, Walmart Corporate,
Path to Purchase IQ

Walmart Proves Its Focus on U.S. Products

On March 23, Walmart announced it will be accepting applications for its 8th annual Open Call. The Walmart Open Call allows entrepreneurs with products made, grown or assembled in the U.S. to pitch their ideas directly to Walmart buyers in hopes of getting branded or private label products on Walmart shelves. The deadline to submit an application through the RangeMe platform is April 30, with the event occurring on June 30. The event will consist of multiple meeting formats, including executive presentations, educational seminars and 1:1 pitch meetings with buyers.

Our Take on the Opportunities

  • This event, which focuses on U.S. products, solidifies Walmart’s previous commitments of spending an additional $350 billion on items made, grown or assembled over the next 10 years in the U.S. With this focus on products sourced within the U.S., brands should consider bringing internationally sourced products into U.S. facilities to meet future sourcing demands.
  • If you are a small brand that has yet to crack the code of large retailers, programs like Open Call provide an opportunity to get your products in front of industry decision-makers that could change the direction of your business. To make sure you don’t waste this opportunity, it is important to have an understanding of what buyers are looking for and the resources to put together a winning pitch.
  • For brands already in Walmart stores and its e-commerce, Open Call will allow your competitor pool to be flush with new ideas and product sub- segments. Having a forward-looking strategy for your omnichannel business that is based on customer insights is the key to preventing category share losses in 2021.

Sources: Advantage Digital Commerce, Walmart Corporate

Key Areas of Focus for FY 2022

Over the past few months, Walmart has made several announcements that show its changing initiatives for FY 2022 and the future, and these were recently reiterated in a forum where top executives spoke directly to suppliers. While the customer remained top of mind throughout the conversation, five topics surfaced to the top in every area of the business:

Our Take on the Opportunities

  • After supply chain concerns plagued retailers in 2020, Walmart is demonstrating a renewed focus on in-stocks. Knowing the bottlenecks in your supply chain and having a plan to monitor and address them is key to maintaining shelf share on both e-commerce and in-store. With the expectation of Walmart rolling out penalties for inadequate labeling and packaging over the next year, make sure your team doesn’t fall behind the competition.
  • As Walmart noticed grocery category share slipping in 2020, innovation was a saving grace. In 2021, Walmart made it clear the basics won’t cut it anymore, not even for legacy brands. To maintain or increase current share of shelf in-store and online, brands need to partner with Walmart to develop a plan to consistently meet the needs of customers with changing preferences.
  • Retail is no longer just about your products. In 2020 we saw customers make more decisions based on a brand’s social and environmental stance. Once placed on the back burner, a brand’s social and economic actions are vital to product success.
  • While Walmart continues to invest in its customer ecosystem with healthcare and financial services, brands should focus on providing offers that will help Walmart reach its goal of becoming a destination for customers shopping in any channel.

Sources: Advantage Digital Commerce, Walmart Corporate, Walmart Supplier Presentations

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