Omnichannel at Walmart brought a lot of excitement to the retail industry in 2020. Earlier this year, Walmart announced its decision to streamline its merchandising division with one omnichannel team to execute a more customer-driven approach. This decision also acts as a call to brands to increase their omnichannel efforts across online, in-store, and OGP. As a result, suppliers are feeling the urgency to develop their brands digitally. We’ve received several questions about this update that we’ve compiled in an FAQ. For more insight on omnichannel at Walmart, read our Omnichannel Hot Topics blog post here.
Are manufacturers using separate brokers for eCommerce vs. Brick and Mortar?
We often see many manufacturers enrolling different brokers for individualized specialties. However, from our experience, this practice is not as sustainable as Walmart (and other Bricks-and-Clicks retailers) push for omnichannel solutions. Separating eCommerce from brick and mortar creates additional friction, competing goals, inconsistent reporting, and less leverage with the customer. Also, we see many eCommerce agencies trying to re-apply their Amazon knowledge and tactics to Walmart.com which does not work.
What is the difference between the .com and the OG algorithm?
The Walmart.com on-site search algorithm has more ‘inputs’ to evaluate versus the OG algorithm, such as Ratings, Reviews, click-through-rates, page traffic, buy-box winner, Rich Media elements, Videos, marketing spending, buyer influence, etc. The OG site has fewer elements to consider for their search results.
Will line review hurdles change to include .com? For example, in the past, it is units + dollars/weeks/stores (and margin consideration). Will that change now?
Run-rates (hurdle rates) will continue to be a major input for Walmart merchants when determining in-store assortment – and are not expected to change. However, the inclusion of other .com elements will become an increasingly important part of the line review process going forward. Digital Content Health scores, Ratings (at least 4 stars) and Reviews (at least 21), competitive pricing, Walmart Media Group spending, and Contribution Profit will all be part of your future line reviews we suggest being ready for.
How do you see the conversation with WMG evolving with omnichannel at Walmart? Across in store and .com.
We are already seeing shifts in discussions in WMG for omnichannel at Walmart to include BOTH .com and in-store sales and assortment. Manufacturers are being evaluated and categorized by their total GMV at Walmart (both in-store and .com sales). We expect the investment asks from WMG to continue to increase.
Is OGP a managed service?
Yes, currently the only way to activate marketing on OGP (including Sponsored Products) is via Walmart Media Group via managed service. There are minimum investment requirements to activate OGP marketing that vary by category – estimated at $150,000.
Will the Store Merchant take over the Online Assortment?
Not immediately – however, based on their recent communication, a major driver for consolidating the merchandising structure was to reduce conflicts between the two buying organizations and to improve profitability. So, we suspect the senior merchandising levels will begin to have visibility to the total P&L’s that will eventually trickle down to the buyer-level. The integration timing will be different by category, but we are guiding our clients to BE READY and proactively discuss your options for omnichannel at Walmart such as Online Assortment and Digital Strategies with your Store Merchants.
What is the difference between global and regular WMG?
WMG has segmented manufacturers/advertisers into 3 groups: Global Top 100, SMB 600 (Small/Mid-size Brands), and All Other. The Global Top 100 manufacturers/advertisers (based on total Walmart GMV and marketing budgets) have larger, dedicated WMG teams to help them with all their advertising needs. The other groups will have WMG contacts, but not a fully dedicated WMG team.
Has there been any indication that sales data from OGP will be available as a result of this merge?
Harvest Group has invested in technology to mine industry data to provide an accurate estimate of item/week OGP sales data. This data has been validated by multiple sources – including Walmart buyers. This does include categories that are not sold directly via Walmart.com. If you need help reporting this data, please reach out to Harvest Group at hello@harvestgroup.com.
With the convergence, will an investment in WMG for walmart.com include OGP?
In the next phase of “One App” (ie. merged Walmart.com + Online Grocery platforms), there will be one entry point, but the underlying platforms will remain intact. Other than cosmetic changes to Online Grocery, the functionality will remain separate from Walmart.com. Therefore, marketing spending and activation will continue to be separate (Walmart.com versus OG) for the foreseeable future.
If you need help preparing your brand for this new omnichannel marketplace, we would love to talk. Reach out to hello@harvestgroup.com to set up a time.
