Vizio Would Put Walmart into Another Ad Stratosphere
And why political advertising promises to make CTV pricey - and unbearable
Whoa!- The Wall Street Journal is reporting that Walmart may purchase Vizio for a cool $2 billion.
We know that Walmart has already become a major ad player in the last few years, as its Walmart Connect business has been growing at 20% clip per quarter, and should eclipse $4.5 billion this year, according to Insider Intelligence.
Bringing Vizio in house would vault Walmart into a whole other category.
Because even though Vizio is a TV manufacturer, it’s increasingly an ascendant TV advertising player; and like with Walmart, advertising offers better margins that Vizio’s core business.
“This isn’t about Walmart owning a line of popular TVs,” said one executive Tuesday at the Kochava Summit in Idaho. “This is about having a direct connection with consumers on the big screen.”
Indeed, Vizio boasts of 23 million logged-in viewers. The combination of Walmart’s vast reach, huge database of purchase information and credit card accounts, coupled with the sight, sound and motion of TV, could create a powerful ad platform. It wouldn’t turn Walmart’s ad business into Amazon’s, but it would put them in the conversation. Every major media and tech company wants a piece of the living room, and Walmart would have one.
Here are some initial big questions regarding the would-be deal:
Walmart has been testing shoppable TV ads with some partners. Could this deal make a create a larger footprint for ‘T-commerce” overnight?
Vizio has a budding lineup of FAST (free ad supported channels). Could Walmart use its consumer data to make FAST shoppable, and also way more targetable (i.e. a Retail Media Network on TV)?
Might Walmart go as far as looking to acquire more exclusive premium programming for Vizio’s FAST service, to compete more with Amazon Prime Video? What about live shopping series?
Walmart has bundled Paramaount+ with its own service. Could Walmart become a hub like Amazon, where it starts selling other streaming services such as Max?
Could Walmart use Vizio to squeeze out other manufacturers in its own stores?
How do LG, Samsung and others react? Would they form some kind of data ad alliance - and or ad network?
What happened to Amazon’s push into manufacturing its own TVs?
It’s a political year, which means one thing - watching ad-supported TV is going to become awful as the year progresses
I was lucky enough to have Ryan Meerstein, of Targeted Victory on my podcast this week. His company specializes in helping Right/Center candidates fundraise and get out the vote.
He has some interesting insights into 2024, where both candidates have raised tons of cash, but are facing a dramatically different ad landscape that just a few years ago (cookies going away, privacy fervor, lots more CTV). Here are some highlights:
On why he’s not super-bullish on post cookie solutions - yet political campaigns have no choice but to spend big - “We have dealt with this incredibly changing landscape,” he said. “I actually think it has probably prepared us more for today and the deprecation of the cookie and the targeting changes that are coming.
We were a little too obsessed with the one-to-one.”
On where the money is shifting - and isn’t - “I think CTV is eating at traditional digital, not at linear,” he said. “[In 2022] what I saw was a big increase in CTV, OTT, all streaming. And I think the common knowledge was that was going to eat at linear's budget. What I saw, I saw it eat at online video and traditional digital's budget.”
On how political spending could throw off ad pricing, and make frequency problems worse later this year - “We're going to spend massive amounts of money in very short periods of time. We're going to have two presidential campaigns that will be the most sophisticated campaigns to ever exist. I think that they...
truly have budgets to both drive message at insane rates and test at the same time.
Then there are some price pressures that could push some of these Super Pacs into some heavy CTV buying.”
On why political advertising is an insane business - “We think our campaign [for Republican Tim Scott] spent $124 million on paid video in Iowa. I think we had 110,000 people vote in the caucus.”