When you’re expanding your business from Amazon to Walmart, it’s helpful to understand the differences between Amazon’s and Walmart’s advertising capabilities. Some ad strategies can be successfully ported from Amazon to Walmart, but it’s not true across the board. Plenty of strategies that may be effective on Amazon can be quite wasteful on Walmart. However, there are also opportunities on Walmart that don’t exist on Amazon at all.
Prefer to learn by watching video? Check out The Key Differences Between Selling & Advertising On Amazon Vs. Walmart
Three Areas of Contrast
The differences between Walmart and Amazon search advertising can be categorized into three areas:
- Platform Differences
- Optimization Differences
- Reporting Differences
At the platform level, there are important variances around auction dynamics, competition, and ad placement.
In terms of opportunities for optimization, differences abound, including item-level bidding, targeting types available, the option to utilize bid multipliers, and more.
And at the reporting level, we find more granular performance reports on Walmart as compared to Amazon.
Let’s break down each of these differences and what they mean for sellers on the Walmart marketplace.
Platform Level Differences
At the platform level, I’ll start off by diving into the differences in auction dynamics because this is foundational to how all of advertising works on Walmart and Amazon.
While Amazon utilizes a second price auction, Walmart adopts a first price auction. This has major implications for your budget and bidding strategy.
The first price auction means the seller with the highest bid wins the auction and pays the amount they bid on a particular item/keyword. For every click that Walmart drives through sponsored ads, the seller pays exactly what they bid for.
In a second-price auction, what the winner pays is one cent higher than the second-highest bidder.
Because the auction dynamics are completely different between Amazon and Walmart, handling advertising campaigns efficiently requires different tactics. With Amazon ads, you can look at your CPC to help estimate how far above your bid the auction winner is, and then place your bid accordingly.
But in a first price auction, because you don’t have any way to determine how far or near the second-highest bidder is, it becomes very difficult to pick the right bid for your item or keyword.
This is why I recommend adopting a conservative bidding strategy to ensure you are not overpaying for Walmart search clicks. The guidance would be to start with a $0.20 bid on auto campaigns and $0.30 on keyword campaigns, and then do upward bid exploration to identify the most valuable bid. This strategy will ensure you are paying Walmart the real value of the click and not blowing away your ad budget inefficiently.