Costco is one of the retail giants in the United States. Now, one of the most visited stores in the country is launching a media sales program, aiming to increase profits, but this is just one of the methods it’s considering to generate more revenue from its members. So far, the company is using technology to attract customers to Costco. Other retail giants with similar programs include Walmart.
In 2022, Walmart saw nearly 30% growth in advertising revenue
In Walmart’s case, the supermarket chain does this through Walmart Connect. A retail media platform launched in 2021, Walmart has quickly become a major player in the retail media landscape. Through its Walmart Connect advertising business, Walmart benefits from less competition and offers more sales channels and customer data, enabling potentially more effective advertising campaigns. In 2022, Walmart saw nearly 30% growth in advertising revenue, and this momentum continued with an additional 30% growth in the second quarter of 2024, surpassing the global advertising segment average of 26%. For brands, this can translate into a higher return on advertising investment, provided they know how to effectively leverage the ads and ad spaces offered by Walmart.
“… And as we complete the fundamental elements of our plan, we can offer new experiences for members”
For his part, Costco’s Chief Financial Officer, Gary Millerchip, shared details about Costco’s initiatives during his fourth-quarter earnings presentation: “This is a multi-year process. And as we complete the fundamental elements of our plan, we can offer new experiences for members. For example, during the fourth quarter, we launched more relevant messages on the Costco.com homepage, highlighting different offers based on membership type and co-branded credit card status.” Retail companies try not to neglect any revenue stream, mainly because technology and the world are advancing very rapidly. Companies like Amazon are making a strong impact, so knowing how to stand out and constantly creating new projects is essential for survival.
Gold Star members are encouraged to upgrade their membership, and non-members are shown information on how to become members
The idea behind all of this is to keep money circulating, to prevent the economy from stagnating. “Executive members are shown information about executive benefits, while Gold Star members are encouraged to upgrade their membership, and non-members are shown information on how to become members. Co-branded cardholders will be shown offers associated with ongoing spending campaigns, while non-cardholders will be shown acquisition offers,” explains the Costco CEO regarding the new features.
Walmart Connect attracts a growing number of brands, providing a unique opportunity to connect with shoppers both online and in-store
Walmart’s approach, meanwhile, centers on advertising. Walmart Connect leverages enhanced digital capabilities to offer targeted advertising opportunities for both its own brands and third-party sellers. Thanks to its multichannel reach and wealth of customer data, Walmart Connect attracts a growing number of brands, providing a unique opportunity to connect with shoppers both online and in-store. The platform allows advertisers to reach Walmart customers across multiple channels, including the Walmart website, mobile app, in-store digital displays, and a network of affiliate sites.
It’s important for customers to be informed about these situations, since the data used is precisely that of the buyers. To achieve the most accurate advertising possible, companies rely heavily on customer data. “These digital capabilities are also key for retail media, as they allow us to target specific ads that offer greater value to both members and suppliers, always respecting our members’ privacy preferences,” Millerchip explained.