Headshot of Giacomo Iotti, a B2C digital marketing manager who likes to write about digital news and trends.

giacomo iotti

Marketing and Tech News & Ideas

👋 Hi! I'm a digital marketer specialised in online advertising, with a passion for content.
Read my posts and let me know what you think!

What Do Chase and Walmart Have in Common? Their Newest Product is Their Customers

What do Uber, Marriott, United, Chase and Walmart have in common? They're all launching the same new product: you!What Do Chase and Walmart Have in Common? Their Newest Product is Their Customers

What do Uber, Marriott, United Airlines, Chase and Walmart have in common? They're all launching the same new product: you! 😱

These companies use their customers' data to display personalised ads, essentially selling this information to advertisers.

Uber sells premium placements to restaurants advertising their menu on the Uber Eats app.

Marriott is planning to use its customers’ loyalty data to show personalised ads on its website and even on in-room TV screens.

United Airlines will do the same on in-flight seats screens.

Chase, the retail arm of JPMorgan, will leverage its customers’ spending behaviour to show personalised deals and discounts from third-party retailers and partners. Thanks to its credit cards, it can directly attribute a customer's purchase to a specific deal or ad. This is extremely valuable for advertisers, eager to prove their value to their bosses and shareholders. Commercial banks showing discounts and deals from retailers is nothing new. But the programmatic use of customers’ data is!

Walmart is building an enormous and extremely profitable ad business, catching up with its nemesis Amazon.

While advertising currently represents just roughly 0.5% of Walmart's revenue, it already accounts for 7.5% of its gross profit. It is estimated to contribute 13% of the profit by 2026. Unsurprisingly, selling ads has a much higher margin than physical products; especially when you already own the customers and the ad inventory!

The retail giant is building its ad business in three main areas:

  1. Website and app.
    Walmart displays ads from manufacturers and third-party sellers on its website and app. Purchases are directly tracked and easily attributed to ad clicks. The power of first-party environments!I
    n fact, Walmart appears to be doing a good job in delivering returns to advertisers. Typically, advertisers get about $6 in return for every ad dollar spent on Amazon or Instacart, compared to over $7 on Walmart ads.
  2. Video and TV.
    In February 2024, Walmart acquired the TV manufacturer Vizio. The goal is to connect with potential customers on yet another device beyond desktops and smartphones. With the rise of “shoppable TV”, Walmart aims to own the full digital journey from discovery to purchase. It even coined the term “rom-commerce”! In the near future we’ll watch TV series stuffed with shoppable products and will buy directly from our remote.
  3. Physical stores.
    Unlike Amazon, Walmart owns a billion square feet of physical retail space. This is the largest yet still relatively unexplored opportunity for advertising! In-store digital screens, audio announcements and product placements are excellent places to show ads. The challenge is ensuring a measurable return for advertisers. The solution appears to involve linking credit cards used for in-store purchases to users' online accounts, thereby merging the online and offline experiences.

With third-party cookies going away, the online advertising industry is re-shaping towards the use of first-party data. Retailers and consumer companies own a lot of first party data! Think of Chase with your credit card transaction history or Walmart with all your purchase preferences. It's only logical that they're now looking to monetise this data.

This new type of advertising is called retail media, when it involves retailers, or merchant media when it involves a broader range of businesses like the ones mentioned above.

Will the big tech companies lose relevance in the online ads market? Hard to tell, but one this is certain: this is the beginning of a whole new era in advertising!

Read post on Linkedin >>
Previous Post
Next Post
  1. Giacomo Iotti
  2. All Posts
  3. Digital Marketing & Advertsing