Walmart continues to push the boundaries of traditional retail: It has revamped its media network and rebranded it as Walmart Connect, a bigger, more comprehensive media offering that the company hopes will become one of the 10 largest advertising platforms in the world.
Through Walmart Connect, the company will expand its advertising role, with a holistic, multi-channel offering that will leverage assets including the Walmart website, app, and loyalty program, along with in-store components such as TV walls, self-checkout screens, and displays (it operates 170,000 digital screens across more than 4,500 stores).
It’s a bold move for Walmart—and for other companies such as Kroger, CVS, and Target that are headed in a similar direction. But they’ll succeed only if they bear in mind that their success depends on one critical factor: their customer relationships.
If customers perceive that Walmart is no longer a credible retailer—if they feel it has been “bought out” by its advertisers—their loyalty could be seriously compromised. A recent news release noted that Walmart’s media network grew by 40 percent in 2020. That network would devalue significantly without a faithful customer base believing in it.
So how do retailers monetize this position without losing customer loyalty—and credibility?
1. Make sure the fit is right – do not compromise your brand / authority
You know your consumers and you know what they want—so give them that. Only promote brands you know will meet their expectations. Your brand trustworthiness is now a critical asset, and should be protected at all times. Consider this analogy: If The Keg were to enter into a partnership to promote brands of wine, diners would expect the wines to be of the same calibre as the food. If they discovered otherwise, their loyalty to The Keg could be impacted.
2. Make the brand connections in a value-added context
While you never want to mislead the consumer, in-store advertising should not be positioned as traditional ads. Make them as functional and informative as possible so they add real value. Because (and this is the crux of the business model) you aren’t just telling the consumer about the product, you’re providing a vetted recommendation for it. You’re giving them additional information to help them with specific needs and pain points. That’s why their trust in you is so essential.
Think user guides, tip lists, blog posts, or social posts—perhaps providing real-world examples or success stories where the products have been used. And to increase the value-add, you could collaborate with the supplier to offer customers a reduced price.
3. Integrate the messaging at the right point in the customer experience
There are times when customers are the discovery phase and looking for new information; conversely there are times where they are just trying to get in and out. Retailers need to make sure their communications align with these different needs. A blog post or social is generally an effective way to connect with consumers who are already browsing for information. On the other hand, ads at the cash or the front of the store probably won’t be received in the same way.
With their extensive data assets and customer knowledge, retailers today are in a unique position to connect consumers with suppliers and drive value for both. This is especially true for niche retailers serving specific market segments. But their integrity is critical to maintaining the customer relationships that make it all possible.