Walmart in fintech

This is the fifth LinkedIn edition of the bi-weekly Consumer & Retail Insights newsletter by CB Insights...but already issue?#139?which means you have plenty to catch up on!

Don't miss out on the next ones and get it straight to your inbox -?sign up here .

Hi there,

It may only be October, but it is already feeling like the holiday shopping season — otherwise known as the months that I hide toy catalogs (paper catalogs! In 2022!) from my children.?

Surprisingly, we have not received a toy book from the most usual of suspects:?Walmart .

But Walmart has been busy this year. CB Insights assessed the retail giant’s broad strategic direction ?back in early 2022. Since then, the retailer has acquired 5 companies and invested in 3 more.?

Source: Analyzing Walmart’s Growth Strategy: How the Retail Giant Is Building E-Commerce And Boosting Profits

The retailer’s high-level strategy remains about the same. But its need to?boost profits ?grew more urgent as inflation jumped, consumers pulled back on spending, and Walmart’s inventory overflowed.?

Its acquisitions, investments, and product launches this year have zeroed in on 3 key areas:?

Fulfillment and delivery efficiency:?Walmart’s acquisitions and investments in 2022 have homed in on e-commerce logistics. In June, it took a stake in?Symbotic , which was already helping automate Walmart’s regional distribution centers. In August, it bought?Delivery Drivers Inc. , which it had partnered with on its internal delivery platform, Spark Driver. Then, in October, it bought?Alert Innovation , which the retailer has long worked with to build its store-based robotic fulfillment centers.?

The retailer is also experimenting with new delivery models across its markets — such as a partnership with?Instacart ?in Canada on a “virtual convenience store” that sources products from 10 of Walmart’s stores.?

And Walmart?is seeing fruits from its efforts to use delivery as a new revenue source: It said in October that its delivery-as-a-service platform, Walmart GoLocal, has already surpassed its 2022 goal to deliver from 5,000 businesses.?

Merchandising tech:?Walmart has invested in tech to optimize assortments, promotions, and pricing , particularly online. In August, for instance, it acquired?Volt Systems . Walmart will use Volt’s solution to share shelf-level data with its suppliers.?

Augmented reality (AR) tools are also emerging as a part of Walmart’s e-commerce merchandising efforts. Following its 2021 acquisition of?Zeekit , the retailer has doubled down on virtual fit, with the launch of virtual try-on tools as well as the acquisition of another virtual fit tech company,?MemoMi . The retailer also launched new AR features on its app that help shoppers visualize furniture in their homes.?

Source: Walmart

Next-gen media and content:?Walmart is hitting the gas on its media network ?and new content to gather more consumer data and boost profit-heavy revenues.?

Its media network, Walmart Connect, made $2.1B in 2021 (for comparison, Amazon’s ads business made $30B+). The retailer has launched several new tools via Walmart Connect that make it easier for brands to launch sponsored campaigns on its website and marketplace. It is adding “Innovation Partners” to broaden Walmart Connect’s audience, including?TikTok ?and?Snapchat , as well as livestreaming platforms?Firework ?and?TalkShopLive . In October, it launched a beta version of the Walmart Creator platform to streamline content creators’ access to Walmart products and commissions.?

Walmart’s ventures into new digital platforms are also extending its reach, particularly with Gen Z. In September, it launched 2 experiences in?Roblox : Walmart Land and Walmart’s Universe of Play. Users can play games, buy virtual merchandise, and more.?

Looking ahead, I am keeping an eye on Walmart’s movement in fintech.?

The retailer’s new CFO, announced in April, was previously CFO at?PayPal . Its 7-year-old payments app, Walmart Pay, is already a valuable source of data, and its financial services ventures are set to include digital checking accounts.?

Plus, the retailer has also continued to invest in India via its stake in?Flipkart , owner of the payments app PhonePe — which itself is growing its financial services offerings. Could Walmart be edging its way into the super app game ?

Happy shopping,

Laura Kennedy

P.S. Have you tried Connect? Every week, hundreds of CB Insights customers are using?Connect ?to meet with technology vendors.

A recent Connect request: A multinational chain of retail convenience stores is looking for a partner that specializes in commerce solutions to drive customer engagement and grow its business.

If you know a technology that can assist with this, submit an?Analyst Briefing here .