Walmart Gives Data and Analytics Monetization A Try

(Sundry-Photography/Shutterstock)

For years, Walmart supplied its vast network of manufacturers and distributors with free data about sales and brand performance. Now with its new Walmart Data Ventures arm, the retail giant is looking to monetize that type of data. The catch is that the data supplied by WDV will be more detailed than what it previously provided and will be accompanied by prepackaged analytics insights.

Walmart is the world’s largest company by revenue, with $570 billion in annual sales generated from more than 10,000 global stores and online sales. With inflation stuck near 40-year highs and a potential glut of inventory piling up ahead of the make-or-break holiday shopping season, the stakes are high for Walmart in its ongoing brawl with Amazon.com for retail dominance in the US, and it’s looking to data to give it an edge.

While Amazon.com and its AWS arm obviously are formidable technology foes, Walmart is no slouch in that department, as it has a long history of pioneering cost-cutting and time-saving technology into stores and the vast American consumer packaged goods (CPG) supply chain that supplies them with goods. You can thank the Bentonville, Arkansas-based company for popularizing the point of sale (POS) systems and UPC barcodes (the RFID chip gambit hasn’t quite panned out). And with the launch of Walmart Data Ventures in 2021, it’s looking to take its big data analytics capabilities to the next level.

WDV’s first offering, called Walmart Luminate, provides external CPG suppliers and internal Walmart merchants with detailed information about what customers are buying, where they’re shopping, and–most importantly–why they’re buying it, says Linda Lomelino, WDV’s senior director of product management.

“We talk about the ‘why’ being essentially the primary research product within that ecosystem,” Lomelino says. “So in a single, centralized data platform, you can essentially understand the what, the where and why of shopper behaviors across our entire Wal Mart omnichannel ecosystem.”

Walmart Data Ventures is exposing data from 2 billion market baskets per quarter (Sundry Photography/Shutterstock)

There are three main offerings in Walmart Luminate, which was launched in late 2021.  The first, Shopper Behavior, gives users the ability to see what the overall performance of product categories and brands are within the Walmart ecosystem, which touches 150 million customers per week. This will help them understand what loyal customers look like, what type of “switching” behavior is happening, and whether there are new entries into a supplier’s space that could impact their markeshare, Lomelino says.

The second offering, Channel Performance, allows suppliers and merchants to get operational metrics about their businesses, including what products are performing well at a store level, Lomelino says. Customers can also perform assortment deep dives to understand what variables–such as brand, pack size, or private labels–are driving sales.

The third and latest offering in the Walmart Luminate line is Customer Perception, which is billed as a way to conduct qualitative and quantitative research into the Walmart experience. This offering  also lets users “hyper-target” customers who have specific shopping or behavioral attributes, Lomelino says.

“For example, in that product, you can actually survey someone who bought diapers in the last four weeks,” she says. “You can even target at UPC level and you can talk to the right customer for the right topic.”

Finding the underlying reason a particular group of shoppers bought–or didn’t buy–a given product is no easy task. Tens of thousands of business analysts spend countless hours rooting through all kinds of source data, seeking clues into the root causes of buying decisions, in the hope that merchants and suppliers can tweak the conditions and the offerings in a way that boosts sales.

That’s more easily said than done. But with Walmart Luminate the capability to stitch together multiple data sets from WDV in a beneficial way is closer at hand, Lomelino says.

“We’re certainly providing a wealth of data elements that suppliers never had access to before,” she says. “Sometimes it’s really hard to normalize the data that you’re grabbing from different data suppliers or data providers. Stitching data across multiple sources can lead to inaccurate conclusions, and so the breadth and depth of our data set is really unparalleled.”

WDV isn’t providing data from other providers, Lomelino says. At this point, it’s more about providing more detailed data from Walmart, delivered via pre-built analytics views accessible in a self-service manner. Users can also pipe Channel Performance data into their own systems via an API if they don’t want to use the new user interface WDV is providing through Luminate. However, bringing external, third-party data into the mix may something the company does in the future, she says.

“The capability around Walmart Luminate is really leveraging our proprietary data assets and delivering them in the form of insights and analytics,” Lomelino says. “Obviously we take deep care to deliver data in an aggregated and anonymized way to protect our customers.  But it’s certainly unparalleled to what we showed suppliers in the past.”

Considering the company previously supplied data to its suppliers for free, it’s good that the company is expanding the breadth and depth of the data it’s now hoping to sell them. While Walmart DV didn’t share what the cost for this new data would be, it certainly has the potential to be worth a lot of money to Walmart. One Walmart researcher quoted in a 2021 Ad Age article pegged the value of data analytics at $1 million for every $1 billion in retail sales. With nearly half-a-trillion in annual sales, that puts the potential lift of Walmart DV at over half-a-billion dollars.

However, Lomelino downplays the notion that the new offering was about monetizing data.

“We are a commercial entity within Walmart. But really the primary focus here is to share the right data and insights and analytics and ultimately serve our customers in a better way,” she says. “Walmart Luminate is not just about serving data, but about merchants and suppliers speaking a common language around the customer and business operations.”

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Editor’s note: This article has been corrected. Only the Channel Performance data is available for download via API. Datanami regrets the error.