Diversification Is Key for Online Brands as Walmart Enters Ad Space

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Brands face big challenges now — but also an opportunity to embrace multichannel online selling.

Amazon’s push into online advertising has been a big hit with brands.

Now, with the lockdown forcing brands to reevaluate both their real-world and digital strategies, online brands are branching out and bringing the lessons they’ve learned with Amazon to new marketplaces and ad ecosystems.

There’s certainly plenty of room for brands to experiment. Amazon’s success sparked an explosion of new marketplaces and ad options, led by Walmart’s push into the online ad space. That could unnerve brands that have only just managed to master Amazon’s ad offerings, and it will certainly make the online ad space a richer and more complex place in the coming months. But many brands are viewing this moment as an opportunity to develop sophisticated, well-rounded strategies that combine a strong marketplace presence, coherent data-driven advertising, and a new focus on an omnichannel consumer journey connecting both real-world and digital touchpoints.

That’s good to see, and a sign of both the maturity and the adaptability of retailers’ online marketing divisions. At a time when e-commerce brands face both colossal opportunities and major challenges, the emergence of new marketplaces and advertising platforms is great news for brands. In addition to lower seller competition for ad space, this phenomenon will also provide brands with an unprecedented opportunity to forge a true multichannel strategy. Get that right, and merchants will be able to reach exponentially more consumers and take their online selling to a whole new level.

So why is this diversification so important for today’s digital brands? Let’s take a closer look.

Target different demographics

It might feel like Amazon is all-encompassing, but the truth is that there are still plenty of people who shop elsewhere. The Walmart.com demographic, for example, consists largely of younger, low- to middle-income families — one of the largest demographics in the USA, and one where despite Amazon’s best efforts, Walmart remains the dominant player.

This means brands now have an opportunity to create digital campaigns that target groups of consumers they may not currently be reaching. As more marketplaces emerge, more granular distinctions will develop, allowing brands to craft product page experiences, ad campaigns, and marketing strategies that are increasingly tailored to specific subgroups of consumers.

The rise of new marketplaces might also make it easier for brands to stay ahead of shifting demographic trends. That’s because Walmart is well known for understanding demographic trends better than many other retailers. Partnering with this retail giant could potentially give brands an inside edge when it comes to effectively marketing as demographic shifts progressively impact the retail space.

Take back control

When it comes to selling online, merchants always want more control of their brands — but that’s hard to maintain when you’re locked into selling through a single marketplace. Algorithms and consumer behaviors change, and many brands have seen their Facebook reach or their Google search ranking unexpectedly plummet as a result. In today’s e-commerce landscape, it’s always better to maintain a wide reach and stay flexible by investing in new sales and advertising channels. Aside from being the quickest way to increase sales volume, having a wider presence allows sellers to build a more comprehensive view of their customers across the Web.

Having a diversified online presence can also help brands to push back against grey-market resellers. While that process is often messy, marketplace operators have much more motivation to help brands clamp down on counterfeit products or unauthorized resellers if there’s a real risk of disgruntled sellers starting to divert their ad dollars to other platforms.

Embrace multichannel selling

When Walmart launched its advertising API, the retailer touted its ability to provide in-store metrics on top of online sales, helping brands better optimize campaigns across their larger Walmart presence.

This emphasizes how multichannel selling doesn’t just mean exploiting a range of different online marketplaces — increasingly, it also means synchronizing your online and real-world retail strategies, even in the current environment. While Amazon’s initial forays into real-world retail are on hold for now, Walmart is leveraging its vast brick-and-mortar footprint for online order fulfillment, so there’s the potential for brands to achieve strong results by combining digital and in-store consumer experiences.

As the economy begins to reopen, and consumers begin to shift some of their purchasing back from online to real-world stores, brands with this more comprehensive multichannel view stand to gain a major competitive advantage if they’re able to leverage such intelligence to develop an effective strategy for measuring online advertising’s impact on offline sales.

Of course, this larger trend around online advertising goes well beyond Walmart. With Amazon already making billions from its ad offerings, there’s movement from the likes of Wayfair, CVS and others to create an ad ecosystem on their e-commerce sites. It’s smart for brands to use Walmart’s new marketplace ads as a launchpad for a true multichannel e-commerce strategy.

Looking forward, this process will help brands to reach more customers, and survive and grow during these challenging times. And brands that succeed will also get a chance to tune up operationally as other new marketplaces launch their ad offerings. Developing a savvy strategy that’s both customized to specific sites and coherent across multiple customer touchpoints will be vital as brands learn to thrive in the new multichannel retail environment.

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