Executive Briefing
Why Walmart is buying a TV brand
Vizio will cost $2+ billion, but it’s priceless for Walmart’s advertising business.
By Dan Frommer on Saturday, February 24, 2024 at 8:00 am
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Walmart wants to watch you watch TV: It announced this week that it’s acquiring Vizio, the smart TV brand, for $2.3 billion.
In a word, this is about advertising. In two more, it’s about interfaces and data. I’ll explain.
As Walmart — like Amazon, Instacart, Target, and every big e-commerce player — is trying to grow its high-margin advertising business, Vizio gives it priceless digital real estate in millions of US homes: The home screen that people see every time they boot up their TV, and control over the ad inventory that already supports more than a billion hours per month of free streaming video.
This is valuable on its own, but it’s potentially much more valuable when controlled by Walmart. If the deal is approved and closes — note that Amazon was just blocked from buying iRobot, a vacuum company — Walmart can integrate it into its existing digital advertising business, which grew 28% last year to $3.4 billion.
Advertising businesses like Walmart’s and Amazon’s — known as retail media networks — have become particularly lucrative over the past decade, mostly for two reasons:
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