by. Rachel Saunders

We are all familiar with big brands absorbing the little guy to increase their market share. This past October, Omnicom purchased Flywheel and Smucker’s purchased Hostess Brands (aka Twinkies). Additionally, who can keep track of who owns who in the broadcast world – is it Scripps or Discovery or Warner these days?!? Nonetheless, the majority of these same category partnerships make palpable sense in building a bigger category footprint, but some are more strategic than meets the eye – specifically Walmart’s recent acquisition of VIZIO.

Walmart Acquires VIZIO

Back in February 2024, Walmart released a press release sharing their $2.3 Billion acquisition of VIZIO, who is known for their Smart TVs. While largely different product categories of major retail vs. entertainment products, this acquisition was a strategic initiative for Walmart to further accelerate their advertising efforts. The acquisition is poised to enhance Walmart's advertising arm, Walmart Connect, by merging VIZIO's advertising solutions with Walmart's expansive reach and capabilities, promising brands new avenues to engage consumers at scale. Simply put, by owning VIZIO, Walmart can continue to monetize the TVs it sells long after they have left its supercenters.

What Makes VIZIO So Valuable to Walmart

Smart TVs such as VIZIO offer consumers both free and paid streaming services through their Wi-Fi network. In return for being featured in the VIZIO operating system, those services have to share their revenues (ad slots) with the manufacturer. Accordingly, Smart TVs know what people are watching, even if they're watching old-fashioned cable TV or are using a third-party device from Apple or Roku. Coupled with VIZIO's impressive growth in recent years, boasting over 18 million active accounts and a flourishing advertising business, VIZIO is extra appealing to brands to unlock their database and stimulate ad revenue growth. Walmart noticed the success from VIZIO and saw it as a means to capitalize on their own close-looped omni-channel media business, Walmart Connect. By combining these two platforms, Walmart hopes to forge ahead in expanding their portfolio and advertising network as it aims to gain more market share in the media space.

How This Benefits Advertisers

Advertising platforms continue to optimize their technology and infrastructure to provide the most effective ad solutions to brands. With this acquisition, Walmart is positioning themselves as a powerful seller of ads backed by VIZIO technology. Essentially, Walmart is now able to know which TV ad campaigns are reaching its shoppers, and whether those campaigns are driving sales. This makes Walmart’s infrastructure more prestigious and trustworthy with this new ability to follow the consumer through multiple touchpoints.

While more complex in understanding than a merger between two major food brands like Smucker’s and Hostess, Walmart’s VIZIO acquisition is a unique but highly strategic partnership that should ultimately drive increased value to its advertisers.

Sources:

The Verge | Walmart VIZIO Acquisition Deal

Walmart | Press Release | February 2024