This is not your grandma’s Walmart anymore. Hell, it’s not even your Walmart anymore these days. With an unprecedented number of initiatives on its plate today, the world’s biggest retailer — almost twice as large as its closest competitor — is both playing catch-up and pull-out-ahead in the retail world. If you legitimately ask what took them so long, they will answer, “Yeah, we know. But retail has to stop living in the past. We’re not and we’re moving on.”
When the company says, “Behind the scenes, we’ve become one of the most innovative retailers in the country. We’ve built a shopping experience that’s faster, smarter, more flexible, and more digital than ever before to make things easier when you shop with us.” It’s not just Walmart-speak. It’s real.
The fact that Walmart is racing forward at a scale and speed that would be the envy of a much, much smaller business, makes it that much more remarkable. Somewhere, driving around in his beat-up Ford F-150 pickup truck, Mr. Sam is smiling…or at least as close to a smile as anyone ever saw back in the day.
Fast Tracking
Walmart’s avalanche of activities cuts across a number of disciplines and aspects of its business, from real estate and logistics to financial services and technology. All of it ultimately comes under the leadership of CEO Doug McMillon who, since moving into the corner office 11 years ago, has taken what was a successful but hardly inspiring giant and transformed it into perhaps the most assertive player in the business. In doing so, he has taken the company’s topline revenues from $473 billion to today’s $681 billion, a 44 percent jump that is difficult to match anywhere in the retailing world.
With all that’s in motion now, McMillon and Walmart are working on getting closer to what was once inconceivable: a retail business doing a trillion dollars a year. It’s still on the distant horizon…but not nearly as far away as it used to be.
Who Knew? Walmart Knew
It’s been a long time since shopping snobs would proudly claim they had never stepped foot in a Walmart store and had no intention of ever doing so. And even if there are a few holdouts still hovering on the Interstates, today most Americans shop — often and regularly — at a Walmart. Still, there’s an underlying stigma about the brand that traces back to Walmart’s rural hillbilly founding days. Walmart is no fool and its new marketing addresses this head-on with a high-profile, slightly irreverent advertising drop themed “Who Knew?”
The edgy White Lotus star Walton Goggins (does anyone think it’s a coincidence that his first name is the same as the Walmart family name?) is Walmart’s storyteller. According to reports, the campaign “was inspired by research indicating that while 90 percent of Americans live within 10 miles of a Walmart, most aren’t aware of the retailer’s brand evolution.” Stephanie Beatriz stars in the Spanish language version, proving that even if all its customers don’t know Walmart the store knows all its customers.
Walmart is reported to have spent $4.4 billion in marketing costs last year and in 2025 we expect this new campaign will eat up a sizeable portion of its budget this year. The ad’s tagline, “The Walmart you thought you knew is now new,” may be a play on words but it certainly is a play too.
It’s My Real Estate
Going all the way back to its origins, Walmart always wanted to control as much of its operation as possible. That’s why it owns its own trucking fleet that picks up merchandise at vendor warehouses and shuttles it back and forth between its stores and its wholly owned DCs. That ownership control extends to the stores themselves, most of which Walmart owns rather than leases.
Recently, it took that a step further by buying up two entire shopping centers in Pennsylvania. Acquiring the Bethel Park Center and the Monroeville Mall were almost rounding errors on its balance sheet, but they represent a smart real estate strategy. By owning entire centers, Walmart can maintain the quality of the property as well as make sure the tenant mix is a good fit for its own stores. Remember when long-ago retailers like Sears Roebuck and Marshall Field owned the manufacturers who supplied many of its products? This is just a variation on that same concept and further establishes Walmart as the master of its universe. Expect to see more of this manifest destiny going forward.
Meet Sparky, Your New Shopping Assistant
AI-generated shopping bots are not exactly newsmakers anymore, but here’s another example of Walmart playing both catch-up and upping the playing field. Sparky, as it’s called, can find products, search recommendations and do more sophisticated things like find sporting events and then identify which team apparel you might want to buy to wear to the game. It can also tell you what the weather is going to be at the beach you’re headed to and, oh by the way, here’s a bathing suit and beach towel you can get for your visit.
The second phase of Sparky promises even more AI capabilities Walmart says you’ll be able to get how-to instructions for fixing that leaky faucet, including, of course, recommendations on what tools you’ll need to buy. You’ll be able to plan complete events, coordinate activities and otherwise have Sparky run your life. It’s not science fiction anymore. And it’s all part of the Walmart control formula.
Drones’R’Us
Walmart has been testing deliveries by drone since 2021, both around its Bentonville, AK headquarters and more recently in Dallas. It says it has made more than 150,000 successful deliveries and if anybody got bonked on the head by a container of Tide it didn’t make the newspapers.
Now, drone deliveries are being expanded. Working from 100 store locations Walmart will start these services in Houston, Atlanta, Charlotte, Orlando and Tampa. This represents a dramatic step up in drone usage that puts Walmart on the cutting edge of technology, right up there with you-know-who (Amazon). Yes, it’s not a bird, it’s not a plane, it’s not Superman: It’s a Walmart drone.
Fintech in the Cards
Walmart’s credit card tie-in with Capital One ended badly in 2023, so it seemed like only a matter of time before the retailer rolled out a replacement. That happened this month when it announced a new program with Synchrony Bank, the folks who already have tie-ins with a number of other retailers across the country. The strategic partnership links Walmart’s OnePay card with a new Mastercard plan in two tiers: one is a general card and one is store specific. One analyst called it “a comprehensive fintech ecosystem,” which sounds about right for something the world’s biggest retailer should have.
Walmart has danced around the idea of establishing a real bank for years and this seems to take it one step closer without the regulatory rigmarole that would be required to actually start a bank. And it’s just one more example of the Boys from Bentonville working to take control of every step of the American buying process. Getting the control picture?
Youth Quake
If there were any demographic where Walmart has historically struggled from both a merchandising and perception viewpoint, it’s been with younger customers — those emerging next-gen consumers just starting to feel their shopping oats. From apparel better suited to Branson, MO and annual meetings that trot out Dolly Parton-esque entertainers than Coachella in Palm Springs, Walmart has always had an age-image issue.
Now the drones, the AI and the White Lotus TV celebs are just the top of the pyramid that are working to undo that picture. Walmart recently introduced a new line of apparel under the Weekend Academy brand specifically geared to the Gen Alpha crowd with most products retailing for under $15. Can you hear Uniqlo or Primark squirming? And the entertainment at its annual shareholders shindig earlier this month? Performers included Post Malone, Camila Cabello, Noah Kahan Jimmy Fallon, Walton Goggins, Chris Paul and The Killers — and not a Country Music Awards star in sight.
Our Forever Walmart
No doubt there’s plenty more happening at Walmart under the hood. For instance, even though the company employed 2.1 million people around the world at the end of last year and remains the largest private employer in the country, that was almost 70,000 fewer than five years ago. Its balance sheet continues to shine, and its stock price is up more than 85 percent in just the past two years – in fact, 144 percent, since 2020. Target is off 16 percent during that same five-year period and even retail superstar Home Depot is only about 50 percent up since 2020.
Giant competitors like Costco and TJX often get all the headlines about being amazing retailers (in fairness Costco’s share price has increased by more over these five years) but nobody is doing it at the scale of Walmart. Nobody. That’s why when the company says, “Behind the scenes, we’ve become one of the most innovative retailers in the country. We’ve built a shopping experience that’s faster, smarter, more flexible, and more digital than ever before to make things easier when you shop with us.” It’s not just Walmart-speak. It’s real.
One of the many Sam Waltonisms out there is “I have always been driven to buck the system, to innovate, to take things beyond where they’ve been.” Now 33 years after his death, Walmart continues to buck that system in ways he could never have imagined.
