Walmart Connect Surpasses $6B in U.S. Ad Revenue as Retail Media War Heats Up

Walmart Connect has crossed a threshold that would have seemed implausible three years ago: $6 billion in U.S. advertising revenue through May 2026, according to figures shared with select agency partners at a closed-door briefing in Bentonville last week. The milestone puts Walmart Connect on track for a $14 billion-plus annual run rate — still well behind Amazon Ads’ estimated $56 billion in 2025 U.S. revenue, but growing at a pace that is forcing brands, agencies, and Amazon itself to recalibrate their retail media investment strategies heading into the back half of the year.

The number is being treated as a credibility inflection point inside the industry. Walmart Connect’s growth — reportedly 38% year-over-year through Q1 2026, per data presented at the briefing — is being driven by a combination of expanded offsite ad inventory, deeper integration with Walmart+ member data, and a surge in sponsored product spend from mid-market Amazon sellers who have been diversifying since Amazon’s sponsored product floor bid increases went into effect in Q4 2025.

What Is Driving Walmart Connect’s Sudden Revenue Acceleration?

Three specific product changes appear to be behind the revenue surge. First, Walmart Connect rolled out its Offsite Ads product to all marketplace sellers — not just top-tier brand partners — in February 2026, opening programmatic placements across the web to a much broader advertiser base. Second, the platform began allowing sponsored brand video units on Walmart.com category pages in March, a format that had been exclusive to search results pages. Third, Walmart’s deal to integrate first-party purchase data into The Trade Desk’s Kokai platform deepened significantly, making Walmart Connect data actionable in open-market programmatic buys at scale.

“The offsite product finally has the reach and the measurement story to justify real budget,” said Nich Weinheimer, EVP of Strategy at Skai, which manages nine-figure retail media budgets across platforms. “We’ve had clients move 15 to 20 percent of their Amazon Ads spend to Walmart Connect in the last two quarters, and ROAS is holding.”

The measurement story matters enormously. Walmart Connect introduced closed-loop attribution tied to both in-store and online purchases in January 2026, giving CPG advertisers visibility into whether a digital ad drove a physical Walmart shelf purchase — a capability Amazon has not fully replicated for third-party brands at comparable scale.

Which Categories Are Spending Most Aggressively on Walmart Connect?

According to agency executives familiar with the Bentonville briefing, the heaviest Walmart Connect spenders right now fall into four categories:

• Consumables and CPG: Procter & Gamble, Unilever, and Kimberly-Clark are all reported to have doubled their Walmart Connect budgets year-over-year, driven by in-store attribution and Walmart+ audience targeting.
• Health and wellness: OTC brands and personal care sellers displaced by Amazon’s Q4 2025 listing policy changes have migrated meaningful budgets to Walmart Connect’s sponsored products.
• Home and garden: Seasonal SKUs with strong Walmart.com search volume — particularly in the $30–$150 price range — are generating CPCs in the $0.45–$0.85 range, well below comparable Amazon placements.
• Electronics accessories: Mid-market Amazon sellers in categories like phone cases, cables, and audio have been quietly testing Walmart Connect since January and are seeing add-to-cart rates competitive with Amazon sponsored products on branded search terms.

The seller migration story is particularly significant for Shopify and Amazon marketplace operators. Several DTC brands — including at least two with Shopify storefronts doing over $20 million annually — told Ecommerce Times they are now treating Walmart Connect as a genuine third retail media pillar alongside Amazon Ads and Google Shopping, not a test budget experiment.

How Are Amazon Sellers Actually Using Walmart Connect in Practice?

The operational playbook is still being written, but patterns are emerging. Sellers who are succeeding on Walmart Connect in 2026 tend to share three characteristics: they have already established Walmart Marketplace presence with at least 90 days of sales history, they are bidding on Walmart-specific keyword variants (Walmart’s search behavior skews more toward brand-generic combinations than Amazon’s), and they are using Pacvue or Skai’s Walmart Connect management modules rather than Walmart’s native campaign manager, which several agency operators describe as still lagging Amazon’s Seller Central ads interface by two to three years in functionality.

“The native UI is painful. You cannot do dayparting, you cannot bulk edit at the campaign level the way you can in Amazon, and reporting latency is still 48 to 72 hours in some cases,” said Liz Giorgi, founder of soona, who advises DTC brands on creative and media strategy. “But the underlying inventory is real and the CPCs are low enough that you eat the tooling friction.”

Pacvue, which supports campaign management across Amazon, Walmart Connect, Target’s Roundel, and Instacart Ads, told agency partners in a May 2026 webinar that Walmart Connect now represents 19% of total managed spend on its platform, up from 11% in May 2025. Skai reported a similar directional shift in its Q1 2026 retail media benchmark report published in April.

Is Amazon Responding — and How?

Amazon has not issued any public statement responding to Walmart Connect’s growth, but there are signals of defensive product movement. In April 2026, Amazon quietly expanded its Brand Metrics dashboard to include upper-funnel awareness data tied to Streaming TV ad exposures — a direct counter to Walmart Connect’s in-store attribution advantage for CPG brands. Amazon also reportedly reached out to at least three major holding company agency groups in May to discuss custom measurement frameworks for advertisers running cross-channel buys.

The more consequential response, however, may be pricing. Several agency executives said Amazon account teams have been offering negotiated CPM floors and bonus impression packages to advertisers in the $5 million-plus annual spend tier — an unusual move for a platform that has historically let auction dynamics manage pricing.

“Amazon is not panicking, but they are paying attention,” said Andrew Waber, Director of Research at Teikametrics. “When you start seeing private pricing conversations at the account level, that is a competitive signal. That is not something Amazon does unless they feel budget shifting.”

Teikametrics, which manages Amazon and Walmart advertising for thousands of mid-market sellers, reported in its June 2026 platform update that average Walmart Connect sponsored product CPCs across its managed accounts rose 12% quarter-over-quarter in Q1 2026 — a sign of increasing advertiser competition — but remain approximately 40% below comparable Amazon sponsored product CPCs in the same product categories.

What Does This Mean for DTC Brands and Shopify Merchants Evaluating Retail Media?

For DTC operators and Shopify merchants who sell or are considering selling on Walmart Marketplace, the Walmart Connect revenue milestone carries a specific operational implication: the platform is now mature enough to warrant dedicated budget allocation and dedicated campaign management tooling, not a test-and-learn line item.

Several practical considerations are shaping how operators approach this:

• Walmart Connect requires a Walmart Marketplace seller account in good standing — brands that have not completed Walmart Marketplace onboarding cannot access the sponsored products product at all.
• Walmart’s content requirements (standardized image dimensions, specific attribute fields, mandatory 360-degree imagery in some categories) mean creative assets built for Amazon listings often require rework before Walmart Connect ads drive meaningful conversion.
• Walmart’s attribution window defaults are different from Amazon’s — Walmart uses a 30-day click attribution window versus Amazon’s 14-day default — which affects how ROAS comparisons are structured across platforms.
• Walmart Connect’s customer demographic skews older and more rural than Amazon’s, with stronger index in the 45-to-65 age bracket and in non-coastal metros — a real advantage for certain product categories and a mismatch for others.

The broader retail media landscape is also being reshaped by the Walmart Connect growth story. Target’s Roundel, Instacart Ads, and Kroger Precision Marketing are all fighting for a share of the budget that is migrating away from pure Amazon concentration. But Walmart Connect is the only challenger platform that has crossed a revenue threshold large enough to be described as a structural alternative rather than a supplementary channel.

What Happens in the Back Half of 2026 — Especially Into Q4?

The holiday season will be the real test. Walmart Connect’s performance in Q4 2025 was widely described by agency operators as “messy” — campaign delivery had inconsistencies, reporting broke during peak traffic windows in the first two weeks of November, and customer service response times for campaign issues stretched to five-plus business days. Walmart has said publicly that it has invested heavily in infrastructure ahead of Q4 2026, but operators are skeptical until they see it under load.

The more immediate question for sellers building their Q3 and Q4 media plans right now is budget allocation. Agency executives at firms including Tinuiti, Feedvisor, and Bobsled Marketing — all of which manage nine-figure retail media budgets — said they are recommending clients allocate between 12% and 18% of total retail media budgets to Walmart Connect in Q4 2026, up from 7% to 10% last year. That shift represents hundreds of millions of dollars in aggregate budget movement from Amazon to Walmart Connect over a single holiday cycle.

“The question is no longer whether Walmart Connect belongs in your media plan. It does,” said Elizabeth Marsten, Group Director of Marketplace Strategic Services at Tinuiti. “The question is how much, and whether your Walmart Marketplace content and operational infrastructure is actually ready to convert the traffic you are about to buy.”

For marketplace operators and DTC founders watching the retail media landscape, the Walmart Connect $6 billion milestone is less about Walmart catching Amazon and more about the fundamental structure of ecommerce advertising shifting. The era of Amazon Ads as the default and only meaningful retail media investment is over. The operational and budget implications of that shift are arriving faster than most sellers planned for.