Higher-margin businesses, such as advertising and membership fees, are helping improve WMT’s e-commerce economics through the business mix.
One of the most significant factors propelling Walmart’s advertising growth is the expansion of its third-party marketplace. CFO Rainey specifically highlighted that the company is drawing more demand from marketplace sellers compared to first-party brands, with third-party sellers representing a higher growth channel for advertising revenue.*
This strategic shift mirrors Amazon’s successful playbook, where third-party sellers contribute substantially to advertising spend. Marketplace sellers typically have greater incentive to invest in advertising because they face more competition for visibility compared to established first-party brands. As Walmart continues recruiting sellers to its platform, each new merchant represents a potential advertising customer.*
*Walmart’s $2.3 billion acquisition of Vizio, the connected TV device maker, closed in 2024 and is already delivering substantial returns. During the Q4 earnings call, Rainey disclosed that the company achieved “triple-digit growth” in advertising with the Vizio business during the quarter.
Brand new $26 minimum at Walmart confirmed by retail giant bosses – and it could go as high as $51 under ruling
And the pay rise will allow Walmart associates to “learn new skills, earn recognised credentials and gain experience in growing fields” so they can “prepare for their next job, and they build careers that can grow with them”.
The changes will impact three training programs within the company – the associate to optician program, the associate to technician program and the associate to driver program.
Trump still trails Obama on total deportations/rejections. If higher wages were due to such, then we should have seen $26 min wage (or the inflation adjusted amount) 10 years ago.
Except for Obama counted in deportations those caught at the border (hence your phrasing of Rejections with Deportations). it was a change in how the statistics were counted and political gamesmanship. By some estimates, he roughly removed 840k vs Trump’s 1.2-1.5mil. In addition, the current no tolerance policy has probably sent a strong message to those working illegally or corporations looking to hire illegally. Obama’s was a more softer message. Although interestingly, as a Senator, he was highly critical of what he perceived as Bush’s soft on illegal immigration policy. In fact, he made many of the same arguments as the current administration in terms of the impact to working class jobs and wages. It’s interesting how short term the memory is of where the Democratic party stood a decade and half ago.
The basic laws of supply and demand do work. If not, to what do you attribute as the reason for the Walton Family’s sudden benevolence?
I don’t believe so.
Walmart is a tough employer. if you are late 3 times-you’re gone. This is a weeding process. They only want reliable employees.
Seems similar to college acceptance in the 1960’s. Practically almost every one was accepted. Freshmen math & English weeded out/trim enrollment roles.
Actually, I think you may be correct in that Trump is deporting more non-criminals (i.e. people that are more likely to be gainfully employed) while Obama deported more that were criminals (i.e. people less likely to be gainfully employed) so there may indeed be something to the lack of workers creating a shortage.
Why must it benevolence? There could be a myriad of factors that lead to this decision. Only a partisan would assume it must be due to immigration policies.
Correct and he is also taking a much stronger tone on violating the policy going forward. By the way, it’s not a position on whether that’s a good policy only the premise it may be having an impact on wages.
It may have a corresponding impact on prices and inflation that might not be favorable.
This isn’t is a thesis for a PhD candidate. It is most certainly speculation. We won’t know without more evidence or perhaps even comments by Walmart as to the sudden increase. But, it is out of character for them and they are a massive employer of entry level workers.
My point is that it is not unreasonable as a plausible explanation and we may see other employers having to raise wages as well. Do you disagree? It is entirely possible that the basic economic theory is in effect. Rarer still, a promise and an action is having its intended impact.
The tradeoff is this may very will increase the cost of living, assuming walmart doesn’t eat the margin.
It’s not. Walmart and other retailers are responding to self-checkout laws passed in a number of states. They have to increase staff, and need a carrot to dangle to attract workers. Not all workers will earn $51 per hour, only those who are deemed worthy to complete a training program for higher level positions that need to be filled.
Good example of how government regulation improves working conditions.
No. The eye exam from an optometrist is billed separately.
I’m just talking about the cheapest frame plus lenses.
AI says progressive lens at Walmart run $150-$400, depending on options. Zenni charges $4.95 for a standard anti-reflective coating – it’s $40 at Walmart.
As a simple hypothesis, I offer Henry Ford’s $5 day. He didn’t do it for benevolence, he did it because his turnover was 400% and it was costing him a fortune training new workers, who would last (on average) 13 weeks and quit because of the monotony and grueling conditions.
After the $5 wage was instituted his turnover promptly dropped to 100% (still high, but nothing like before) and he made scads of cash because the factory could operate more efficiently.
I would like to see WalMart’s employee turnover statistics before and after, and see if they were paying “comparable wages” as others to decide whether this hypothesis works out. It was easy for workers to jump from Ford’s factories because everybody was paying the same. Once he doubled wages, they came, they stayed. (Mostly.)