Walmart Set To Acquire Vizio In A $2.3Billion Deal
Walmart set to acquire Vizio, a TV maker, said on their released statement. Explore Walmart's strategic move into the entertainment industry with this major acquisition.
Author:Hajra ShannonReviewer:Paula M. GrahamFeb 21, 2024187 Shares18.6K Views
In a groundbreaking move, Walmart set to acquire Vizio, a TV maker, for a staggering $2.3 billion, signaling a strategic shift to bolster its advertising business and take on competitors in the smart TV market.
"The acquisition of Vizio and its SmartCast Operating System (OS) would enable Walmart to connect with and serve its customers in new ways, including innovative television and in-home entertainment and media experiences," announces Walmart in a press release.
Vizio's stronghold in the smart TV arena, with over 18 million active accounts using the SmartCast OS, positions it as a pivotal player. The acquisition aligns with Walmart's ambition to compete head-on with affordable smart TV offerings from industry giants like Amazon and Roku.
Walmart's Foray Into Streaming TV Opportunities
Walmart's strategic maneuver extends beyond a simple acquisition; it's a calculated step into the burgeoning realm of streaming TV. With the purchase of Vizio, Walmart gains the capacity to sell ads through streaming services on televisions, potentially making it a formidable player in the TV streaming wars.
"This accelerates Walmart’s advertising as it moves into streaming TV opportunities," observes Andrew Lipsman, an independent media analyst.
The acquisition not only elevates Walmart's advertising capabilities but also positions the retail giant to explore a more significant role in the TV streaming landscape. Industry analysts suggest that further acquisitions, particularly in the streaming service domain, could be on the horizon.
Walmart's Advertising Push
Walmart's move to acquire Vizio underscores a broader trend in the retail industry — diversification. Beyond its traditional retail offerings, Walmart envisions supplementing its low-margin retail business, especially in the highly competitive grocery sector, through advertising revenue.
"The deal underlines that retail is becoming a much more diversified business than it used to be," remarks Neil Saunders, a retail analyst at GlobalData Retail.
With over 500 direct advertiser partnerships, Vizio's Platform Plus business has become a major contributor to the company's gross profit. Walmart's existing Onn in-house brand of TVs will now be complemented by Vizio, providing consumers with a more extensive range of options in the affordable smart TV market.
Walmart's Advertising Aspirations
Walmart's foray into advertising is not a recent development. The retail giant has been actively pitching its ability to reach customers, leveraging the extensive shopper data it possesses. With 90% of Americans shopping at Walmart annually and a weekly influx of 160 million visitors to its website and stores, Walmart aims to curate and target ads across all platforms, enhancing its advertising reach.
While Walmart's advertising business reached $3.4 billion last year, accounting for less than 1% of its total sales, the acquisition of Vizio opens avenues for higher-margin advertising dollars.
As Walmart reinforces its position in the ever-evolving retail landscape, the acquisition of Vizio emerges as a pivotal strategy, propelling the retail giant into the realms of media and advertising, aligning its vision with the dynamic shifts in consumer behavior and market trends.
Hajra Shannon
Author
Paula M. Graham
Reviewer
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