Expanding Brands via Walmart Marketplace

Paul Sonneveld
I'm your host Paul Sonneveld and today we are talking about Walmart marketplace and specifically how you as Amazon Agencies can open this additional channel for your Amazon lines. To help us do this, I have invited Ryan King to come along and share his expertise. Ryan is the CEO of BlueRyse, a Texas-based Marketplace agency firmly focused on Walmart. Ryan has been with BlueRyse since 2020. So brings a broad range of experience to the conversation today. Welcome to today's episode, Ryan. 

Ryan King
Thank you, Paul. Great to be here. 

Paul Sonneveld
Thank you before we start just tell us a little bit about BlueRyse, there's not that many you know agencies that specifically focus on Walmart. So just give us a little bit of context. What do you guys do? How long have you been around? Paint a picture for us. 

Ryan King
Right. Yeah. So myself and my co-founder have our background like many service-based agencies in the space as private label brand owners and sellers ourselves. So started multiple years ago, selling and scaling brands on Amazon. And about three years ago, we started looking at the emerging marketplace at Walmart and recognize the blue ocean that Walmart presented as an opportunity to diversify on other channels a little bit late in the afternoon for me my tongue is getting tight here. 

And so as we explored it, we saw especially during COVID things started accelerating as a Marketplace and realize there's an opportunity to provide services on that channel. So we started that about two years ago and we serviced 7+ figure Brands, E-commerce Brands, aggregators, first-party retail brands with Walmart, and kind of what we do. We do full-service management for Brands. So everything from assistance in account setup all the way through to Ad management and just strategic growth management as we partner with Brands. 

Paul Sonneveld
Well done for building a business. I know what it's like to get off the ground So, great. A lot of the people that shoot into Marketplace Masters work for Amazon agencies, or aggregators, you know, and they're building Amazon Brands. And of course, the question here today is, how do you think about spending those brands to Walmart Marketplace?  The first thing, is we'll get two benefits and all of that in a sec. But the first thing I want to ask you was if I work with a portfolio of brands and say, I've got 50 clients. How do I work through which of those may be really good candidates for Walmart? 

Ryan King
Yeah, it's a great question. So I'd say at first when you're thinking through the maturity of the lifecycle of the brand. So obviously the 80/20 is maximizing for many Brands to the opportunity of amazon.com. So as they're growing they're probably not ready to diversify into other channels yet until they fully have maximized the opportunity on Amazon. And what we see is once they hit that, maybe that seven-figure mark on Amazon right around there, the high six figures are low figures, that's one of those time start considering what it's like to open up other channels. And so that's one of the elements I would say specific to the brand. 

What we've seen, the difference between Walmart and Amazon is that the hero products on Amazon may not be the same hero products in the catalog for a brand on Walmart. And so, what that means is basically if they have a breadth of SKUs, maybe their variety of products, not a single product business and a variety of products, maybe 10 or more SKUs so that you can really test the market, see which ones are going to be the leaders on Walmart. 

And then a couple of the things I would say is we evaluate Brands, Walmart is still a low-cost leader as a Marketplace. And so what we don't see performing as well in most categories is a highly Niche down product at a premium price point. So, that's a great competitive strategy on Amazon because demand is there and the Shoppers have been conditioned to look for that premium on Walmart. The market is still a bit nascent and so low cost a little more generic in products.  And so, one opportunity might be if looking through a catalog, if a brand has products that maybe you have already peaked in the lifecycle on Amazon, maybe the competition is grown, there might be a second life to that product on the Walmart marketplace. 

Paul Sonneveld
That's really interesting. That's the first time I've heard some of those differences between, what sells really well on 1 channel, or one marketplace versus the others. And it's a great way to diversify as well, of course, Other Shoppers, I mean, most people in the US will shop on Amazon and I'm sure most people in the US would’ve at least stepped inside a Walmart store at some point in the course of a month. But in terms of the actual audiences, have you noticed, Sort of difference in terms of demographics? Ages? Is there anything there that you can point to and say there's some differences or you find them fairly homogeneous?

Ryan King
They're largely similar. But one data point I'd probably dry out was from an earnings call with Walmart as they're obviously focusing on this and how to grow out the channel. They still see the primary reason to go to walmart.com or go to Walmart is price and low price, but they've seen a growing Market segment of convenient space Shoppers. And so that does mean that the better for you type brands, the organic type brands, more of these luxury type brands are making headway on walmart.com. And so I would say it's similar with a heavier weight towards the price consciousness. 

Paul Sonneveld
Yeah. Potential opportunity that for brands then. So let's just dive into some practical aspects here, the registration process. Obviously, Amazon, you can sign up yourself, and submit some paperwork. Hopefully, job through a few Hoops or you're done 

Ryan King
Right. 

Paul Sonneveld
How does it work with Walmart? And you know I've heard conflicting kinds of stories over the years, being very difficult at all of a sudden opening up and every man all can register. What does it look like right now both consists of registration and I guess the level of competition on the platform?

Ryan King
Yeah. So as far as getting to the actual application, it's not too difficult. I think it's marketplace-apply@walmart.com or .walmart.com is the application link. They do have requirements a little bit higher gates than Amazon. And that you have to have a basically, to boil it down. What Walmart's looking for, is a proven sales history. So, a brand new entity is not probably going to pass through their filters. They're looking for a demonstrable history of customer service. And so if you have probably if you've done, six figures or more, for at least six months to a year, you have a much better chance of getting onto the platform. If you're on Shopify already, there's ways to get into the platform because they've negotiated partnership with Shopify and that way, those are two ways. 

That said there is still. This is probably where you here and mix stories. Even great candidates, that Walmart themselves would love to have on the platform, their application process still has a lot of box in it. That will automatically reject on a hair trigger. If there's a misspelling somewhere in the application, if there's something in a document that doesn't look like it's matching exactly with what you stated in the answer fields. And so a lot of the occasions, what we've run into is even retail brands in distribution with Walmart already, they've been asked by Walmart buyer to get on the third-party Marketplace to round out their assortment have been rejected offhand for from applying. 

And so good news is, there are people behind that process and if you there's ways to engage the business development team that are incentivized to bring new clients on board, once you get to that layer, they can help you navigate those things. But yeah, if you're an actual brand, a serious seller who would like to expand and you have some assortment probably 45 SKUs at least without least six months experience around six figures or more. There's really no reason you shouldn't get on. One other caveat is they say that you either have to be a U.S. entity and this is key for the European market, other markets. U.S. entity or have a U.S. EIN. So you've got to either have your W8 or W9 and be able to present that during the application process. 

Paul Sonneveld
What about the level of competition? I noticed I think charges floating about from Marketplace post signal speeds of being a lot of Chinese sellers that have gone onto the platform. Can’t remember the exact time and I think it was over a year ago where Walmart kind of open the gates to International sellers. What is the level of competition look like right now, and I guess in the context of Amazonas well. 

Ryan King
So right You could probably define a few ways. Yes, there was. I think one of the metrics I saw on that report of, in the last, I think they're looking at a last quarter. I think they said 50% of the new International sellers and think this is cute one we're from China. So they have been opening up the doors, but in general, I think the ratio of sellers, I can't remember off the top of my head right now. Ratio sellers name is on, might be one, and Paul, you might be able to correct me on this. One to maybe  I don't know 30 maybe Shoppers one seller for every 30 shoppers every 300. It's probably an eighth of that or times 8 you have many more Shoppers, they need to have sellers on the Walmart marketplace right now. 

Some of the some of the ways to identify that competition are review accounts is a great way to see, kind of you go into earbuds, bluetooth earbuds on Walt on Amazon right now, you're going to see top positions in the 40,000 reviews and they've been there a while and they've established a remote. The equivalent on Walmart, It's going to be likely more in the in the factor of four hundred reviews, maybe a thousand if they're if they're really getting after it. 

But that's one of the opportunities we see right now is competition is much lower at the moment and Shopper volume is picking up. I think Walmart last thing is these monthly subscribers. The Walmart plus is the round the number o f120 million right now. And so there are aggressively pushing into the equivalency of Amazon Prime. So the Shoppers are coming to the marketplace, and there's much better ratio of sellers to Shoppers. 

Paul Sonneveld
I almost like to refer to that conversation as this more fish food to go around. There's not as many fish swimming around in the pond is a little bit more fish food, more, more consumers for sellers. I think is a great way to look at it and of course, you've got to think about like what the search algorithm as well and SKUs that operate in terms of page one versus top positions in the like. 

Ryan King
One of the note that does bring something else to mind and this is a big question is, Walmart is historically a retail first platform so it's a massive retailer. The largest retailer in the world that has a .com platform. They're pushing more and more into just being known as omnichannel. But a lot of those, there is competition in several categories from the established large 1P Brands, so you can think Unilever, Proctor and Gamble. Those kinds of brands that are in the store shelves are also going to be present on the marketplace. That doesn't mean it's untouchable, but that is a unique factor may be on Walmart. A little more influence on Walmart that maybe on Amazon. 

Paul Sonneveld
Yeah, so size of the prize, I've got a great brand. I'm doing six, seven figures on Amazon. If I'm an agency, and I'm talking to that particular brand and say right let's get a plan together. Let's make half to one of our priorities to launch your, some of your products on Walmart. How do I set expectations around revenue? GMV? What's cheaper with Walmart versus what they're seeing right now on Amazon? 

Ryan King
Yeah, we often talk about it in terms of, there's incremental sales growth right now and the shorter-term goal versus playing the long-term. So there's the short-term strategy and kind of the long-term strategy. So, everybody's talking a lot about the long-term strategy. Some what about when you hear, this is Amazon of 2009, 2012 picker year historically and wouldn't you love to been on it back then? That's kind of a long-term strategy a bit of your, look at where you are now and how well those brands are established now. So there's that factor. 

But when you're talking about incremental sales lift and revenue, we usually say, hey give six months to really start gaining traction. And once you get out of six months mark and is varies by category obviously and by product, price point, all those things, but the range we're seeing is four to twelve percent of Revenue that a mature Amazon brand is seeing on Amazon, you can expect to probably be seeing on the Walmart side. 

Paul Sonneveld
So that could be a couple of hundred K a year in terms of extra, revenue and obviously, hopefully, this is probably behind there as well that if they make sense. 

Ryan King
Absolutely. 

Paul Sonneveld
Now I know there's a lot of solutions out there in the market, and obviously, one of my favorite ones and I'm saying that little bit sarcastically but it's the people like general advice and said, look don't worry we'll just take all your Amazon listings and will push them onto Walmart or any other channel. And therefore this is like this, super low-effort exercise, with a high return right? In my experience, that's never the case. You're going to have to invest the time, you have to invest the energy. On Walmart specifically, where do people really need to invest and where do you caution them? To say, don't glance over this. If you want to get sales you've got to do this. 

Ryan King
Yeah. No, I completely agree with you. I think there is the temptation to go mile wide, but we know that it means an inch deep usually and kind of to give quantifiable to that on Walmart. Walmart will give you a listing score so a quantifiable listing score available to you through the seller center for every listing in your catalog 0 to 100 percent. The average across the marketplace is around 50 to 60 percent quality score for Walmart. They optimize differently than Amazon. So product title links, all sorts of play into that. And that's because a lot of people are just syndicating content over or you've got a lot of drop shippers that are just trying to look for the low-hanging fruit, all those reasons. So that's one measurable it’s at 50 to 60% of quality score. 

So the things that someone needs to look at is imagery can be the same. If you're pushing things over from an Amazon, obviously, it can't have Amazon branding on it, anything like that but imagery more or less. It's very similar. Got some kind of image stack you've got the ability to put up video directly in the listing stack are the image deck. 

Their title length is different type of length needs to be shorter and more to the point on Walmart and that is rewarded or penalized. You can think of it as they're optimizing for Google SEO. That's, that's a large influence on it. And so, a shorter title link with maximizing the first 50 characters. So, it shows up in Google search, the description and key features, they call them bullet points. Key features on Walmart. Description is a paragraph, kind of short, paragraph description optimizing those for what Walmart's looking for. 

And the real target you get a small search boost around 80% quality score. The real target is 95% or higher. We know that because category managers and directors and Merchants everybody else they'll open up more doors of opportunities. If you're showing that.  And I'll foot in it all, I'll put the punctuation on it. With one tip that you ask for what is one area that a lot of Amazon-based sellers are sleeping on. That's probably costing them a lot. Is on Amazon, you can get away with without fulfilling all the backend attributes.

We know this because when we work with a lot of even Advanced Sellers and get their category listing report to get data from across the catalog, a lot of the backend attributes are missing and they're not absolutely necessary. They are very important on Walmart, you can miss out on search relevancy for key terms, you can be misclassified the wrong product type by the system, there are even manual filters that if you don't have the right color in or anything else, if someone were to search, For red, dog leash and you just didn't have read and you might be manually filtered out from that search and not even know it. So attributes and doing your due diligence there is rewarded, highly on Walmart. 

Paul Sonneveld
So that sounds like listing optimization is certainly an error you can have to invest some time in and do it right according to the way that Walmart likes to see it done and to feed their social algorithm, which operates very differently to Amazon.

Ryan King
Yeah.

Paul Sonneveld 
Also, briefly touch on Advertising as well. Mostly on Amazon, that advertising is such a big deal. Like you just cannot ignore it. It's part of doing business. 

Ryan King
Yep. 

Paul Sonneveld
Where is Walmart at in terms of the advertising platform, both in terms of technology and maturity but also in the necessity to drive sales, ranking and the like. Can you paint a picture for us? 

Ryan King
Yeah, so as far as necessity we, by the sheer fact that it's much lower cost and fairly efficient on Walmart. We usually even skip over this. The question necessity, just because it's a little bit no brainer on Walmart. So, you know, average, I think that what was the CPC average on Amazon? I think is a dollar twenty four and Q2 equivalency on Walmart was 80 cents as average cost per click and so much, lower cost per click.

The abilities of Walmart's advertising platform are fewer. They really launched the Self-Serve Option about a year and a half ago. So you can really think of it as it's basically search and grid, sponsored product, basically searching grid carousels next to buy box, those kind of things is the extent that most third-party Marketplace brands have right now. 

The equivalence of a sponsored brand post like a what they would call a search brand amplifier on Walmart with a banner ad across the top. That is only available right now for first-party products, but that is coming sometime this year and that's also a feature. What we find is running Auto and manual. It kind of combined approach Auto campaigns have more placement options than manual campaigns and then optimizing the manual campaign to kind of replace some of the inefficiency of Auto in search grid is probably the best one-two Punch.

The big change was up until June, Walmart was the first bit on the auction so some listeners might have recall that our agency to heard that. And so, it used to be if the closest bid was there, the winning bid is 50 cents in, you were trying to find the ceiling and you bid five bucks, just to see what the highest cost per click would be. Actually, Walmart, would have taken your five bucks. Prior to June for that click it's moved to a second bid auction. Now it's great. And that's they've seen a huge reduction in CPC as a result over 30 to 40% in a lot of cases.

But now you can apply some of that same Ad strategy that you would have applied it on Amazon to Walmart. That's the main strategies on Ad Placement. The other big change was in the past prior to June, you could not appear organic, and paid at the same time. So, a big strategy was if your position five organically and you paid for position one, you just moved up four spots but you had to pay for it with probably zero incremental lift in sales or negligible. Now you can gain extra real estate. So that's another Factor. 

We are one note is, and I don't know, when this will be corrected to many ways, one challenge right now is, although more brands are able to qualify for bids based on relevancy, what we're seeing in a lot of categories, still is actually functionally only the top eight winning positions. The eight to ten winning positions that show up on page one, are actually going to be visible in paid search and grid because it's repeating the same results page after page. So in effect, if you want position one on page one, you're actually also position 1 and page 2. So that's great. If you win the bid. 

But those things. So there's some hiccups along the way as their continue to grow and there's certain things they're doing, but it's still worth it. The biggest challenge I think for agencies is to actually efficiently continue to grow spend, you can get great row as great, ACOS, TACOS, however you want to measure it. Actually, increasing the spin given the few levers to pull is probably the harder part of identifying how do you capture more and more sales through that channel?

Paul Sonneveld
Yeah. Very interesting. Looks like they're a different part of the journey obviously, but that creates a lot of opportunities as well, particularly if you take the time to understand those differences and you find a way to capitalize on them. 

Ryan King
Yeah. One more point on that I'd say is that the interplay between relevancy for the keywords, so this is where that foundational attributes. Everything on the listing optimization plays in with the new second bit option, relevancy is huge is too far as who wins that bid. 

So product A, let's say dog leash again. There are a dog leash and they're betting $3 per click. Maybe you're a dog bowl and you're wanting to bid on dog leash. If you don't show relevancy for dog leash, your less relevant in your bidding, five dollars, trying to outspend them, chances are they're still going to win at $3 per click because of how the relevancy scored. So, there's a bit of gaining ground in organic and paid signals to climb all the way to the top with specific keywords. You got to watch that and kind of stair and step it up. 

Paul Sonneveld
Thank you. The last bit I want to switch to do now is we're sort of on the 24 minute mark. So I want to wrap it up but I do have and this is one of my favorite questions. Alright. So you've always been deep into the Walmart space. We do this for a couple of years, day in, day out. Typically you would have made a lot of mistakes along the way and learn from them. All right, so this is, sort of, let's open up the barn and see what's really going on. 

What I'm really interested in is, particularly popping your early days. What are some of the learnings, mistakes, pitfalls that you have encountered yourself as an agency or maybe with your brand, with your clients or have seen others do that. For those listening try and avoid learning from your, your experience. So what are some of the most common mistakes that you that you see on the platform? 

Ryan King
I think some of the early ones for anybody and it certainly it, we had a steep learning curve. One is the adjust that a big one and we kind of already covered a little bit but clearly setting expectations. So when we found brands that were ready to go and they heard the buzz. This is Amazon of 2012, the expectation automatically set was, I can throw something up. It will just Skyrocket. While in some ways, it is similar, it's a longer play. So, managing finding the brands that seem to be right fit with and setting healthy expectations. The other ones were around price point and what products and adjusting for, kind of the maybe not the hyper niched products and identifying, those and working with those, I'd say some the other things were just learning how to really optimize well with Walmart unique to Walmart versus Amazon.

And the other one, I think that the big surprise is in the system there are challenges. We get content ranking issues all the time on Walmart. It's not as frequent on Amazon, but all the time on Walmart. Even if you're the sole content owner, you registered for brand portal to get authority, there are Bots that come the system for Walmart, that are looking for discrepancies. And the way it interacts, even if it doesn’t touch your listing, but touches something near in a category. It may lockdown fields for you.

So learning how to circumvent those issues and how to escalate to the right people. Those were some of the steep learning curves in the issues. There's a lot of horror stories people just frozen in the water, where a listing is down and error status because something needs to be changed and they're also locked out at the same time. For me, I will change it. Now, that's not, that's also Amazon. We had those stories too, but the learning curve for how to do that. But I'd say expectations for agencies is that are working with brands setting those expectations really clearly and conservatively and then working together to track progress towards a common goal is probably the biggest one. 

Paul Sonneveld
Awesome. Thank you very much Ryan. We are out of time. So let's wrap it up there. Thank you for coming on the show. Thank you for being really generous and sharing your Walmart expertise with our audience today. I'm actually pretty excited about this conversation because I feel like I've got a couple of nuggets from you where if I was serious about Walmart. I could really, you know, there are opportunities there to take advantage of let's put it that way.

Now for anyone who's actually looking at this and going right? Yes, I'm interested in Walmart but I don't want to myself and I do you want to explore your services, how can they get in touch with you? 

Ryan King
Yeah, so really easy. They can connect to us on our website, it's blueryse.com. This is spelled B-L-U-E-R-Y-S-E.com. You can email us at connect.blueryse.com. and I'll just, I'll just share. Also, we're doing a special end of summer deal and we're offering the first three months of service at 20%, discount for those who sign up by September 22nd. And so if you hear this, just email us or reach out to us through the website and be sure to mention MerchantSpring in that communication and we'll get you that deal. 

Paul Sonneveld
That's a great deal. Well, thank you very much, Ryan. That's it everyone for today's episode of marketplace Masters. I hope you enjoyed your show and I look forward to having you along on the next one. Take care till next time.