The strategy: Walmart’s latest Office Space-inspired ad campaign "Case of the Mondays" is a clear shot across the bow at Amazon and part of a bigger strategy to compete with the ecommerce giant head-on.
This ad campaign not only aims to stanch the bleeding but reveals an apparent competitive front against Amazon by (1) going after Amazon’s dominance of online shopping holidays, (2) cultivating a stronger third-party marketplace, and (3) competing more directly with Amazon Prime.
Taking on Amazon: Walmart has traditionally owned the big offline shopping days during the holiday season, Thanksgiving weekend, and other weekends. As shoppers return to work on Mondays, they shifted their holiday shopping online—often on sites other than Walmart.
Cultivating a stronger third-party marketplace: Walmart is quietly but aggressively building out its third-party marketplace. It recently rolled out a suite of new self-service tools to make onboarding and launching campaigns easier for third-party sellers. It’s also rolling out the red carpet to digitally native D2C brands—most of which have resisted selling through Amazon—with the promise of promoting high-performing brands on the marketplace onto Walmart store shelves.
Strong marketplaces provide the traffic scale and quality desired by brands, and the ad auction density to drive price efficiency—which in turn encourages more investment from brands. Amazon’s monetization may not be realistic in the near term, but if Walmart could even close the gap with Instacart on average revenues per user, it would add a couple billion dollars in ad revenues.
Competing with Amazon Prime: The Walmart+ paid membership program has been gaining steady traction since its 2021 inception, with 16% of shoppers indicating they are members, according to our latest Bizrate Insights survey.
In the short term, Walmart is sacrificing a lot of margin to encourage more membership, and it likely has to do with its fast-growing retail media business, Walmart Connect. Improving its loyalty program and digitizing more transactions are critical to building out its first-party data strategy, the fuel for Walmart Connect.
The big takeaway: Walmart’s flywheel strategy is now coming into sharper focus, and it’s not shying away from competition with Amazon in the process. The bigger a foothold it grabs in ecommerce, the faster that flywheel will accelerate. That’s why Walmart is leaning into ecommerce this holiday season with a major case of the Mondays.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.