Walmart+'s Streaming Strategy: A Win for Retail and Media Synergy

Walmart’s evolving bundling model, centered on its Walmart+ membership program, represents a strategic masterstroke in the convergence of retail and media. By integrating streaming services like Paramount+ and Peacock with retail perks such as free grocery delivery and fuel discounts, Walmart has created a value proposition that challenges traditional competitors like Amazon Prime while addressing shifting consumer demands. This strategy not only drives subscriber growth but also positions Walmart as a leader in the broader trend of retail-media convergence, where physical and digital commerce intersect with entertainment.

The Power of Bundling: Flexibility and Affordability

Walmart+’s 2025 bundling model allows members to choose between Paramount+ and Peacock at the ad-supported tier, with the flexibility to switch every 90 days [1]. This approach caters to diverse consumer preferences, leveraging Paramount’s live sports and Universal’s library of blockbusters while keeping costs low. The $98 annual fee—significantly cheaper than Amazon Prime’s $139—targets price-sensitive households, particularly those earning under $50K, a demographic Amazon has historically struggled to attract [2]. By bundling streaming with retail benefits, Walmart+ consolidates multiple expenses into a single membership, enhancing perceived value and reducing churn.

Subscriber growth underscores the model’s effectiveness: membership surged from 11 million in 2022 to over 20 million by 2025 [2]. This growth is further amplified by dual subscriptions, with 25% of U.S. consumers now holding both Walmart+ and Amazon Prime memberships [3]. These dual subscribers spend 46% more on average in retail purchases compared to single-subscribers, highlighting the program’s role in driving cross-category sales [3].

Financial and Operational Resilience

Walmart’s financial performance reinforces the long-term viability of its bundling strategy. Walmart Connect, the company’s retail media network, generated $4.4 billion in ad revenue in 2025, a 24% increase driven by AI-powered targeting and shoppable ads [4]. The integration of agentic AI into logistics has reduced delivery costs and expanded coverage, enabling Walmart to maintain competitive pricing while investing in digital infrastructure [5].

The company’s profitability metrics are equally compelling. Return on Assets (ROA) rebounded to 2.18% in 2024 and is projected to reach 7.45% by 2025, outpacing rivals like Costco and BJ’s [6]. Walmart’s debt-to-equity ratio of 1.55 and interest coverage ratio of 10.07 further demonstrate its financial stability [6]. These metrics suggest that Walmart can sustain its high-margin membership model while navigating macroeconomic headwinds, including rising tariffs and inflation.

Retail-Media Convergence: A New Ecosystem

Walmart’s acquisition of Vizio for $2.3 billion has accelerated its dominance in retail-media convergence. By integrating Vizio’s SmartCast OS into its ecosystem, Walmart now offers shoppable ads on connected TVs, allowing consumers to purchase products directly from their screens [7]. This innovation taps into the $100 billion U.S. digital retail market, with over half of streaming households engaging in TV-based commerce [7].

The company’s omnichannel strategy—leveraging 5,500 U.S. stores as fulfillment hubs—has driven 50% growth in store-fulfilled delivery, blending physical and digital retail [8]. This approach not only reduces delivery costs but also aligns with ESG goals, as localized fulfillment cuts carbon emissions compared to centralized warehouses [8]. Walmart’s AI-driven inventory management and automation further enhance efficiency, ensuring it can scale its operations without compromising margins.

Challenges and Opportunities

While Walmart’s strategy is robust, challenges persist. Amazon’s 74% share of U.S. retail media ad spend in 2024 highlights the competitive pressure [9]. Advertisers have also raised concerns about Walmart’s aggressive revenue asks and limited transparency on ROI [10]. However, Walmart’s expansion into CTV and its focus on first-party data—such as personalized AI recommendations—position it to capture a growing share of the market [11].

Subscription fatigue and the rise of short-form content platforms like TikTok also pose risks. Yet, Walmart’s emphasis on convenience and affordability, combined with its ability to adapt to consumer preferences (e.g., adding Burger King discounts), ensures its relevance in a fragmented media landscape [12].

Conclusion: A Strategic Win for Long-Term Value

Walmart+’s bundling model exemplifies the future of retail-media convergence. By combining streaming, retail, and AI-driven logistics, Walmart has created a high-margin, recurring revenue stream that drives both customer loyalty and operational efficiency. Its financial resilience, global expansion, and sustainability initiatives further solidify its position as a long-term investment. As the retail-media landscape evolves, Walmart’s ability to innovate—whether through shoppable TV ads or agentic AI—will likely cement its dominance in the years ahead.

Source:
[1] Walmart+ Expands Free Streaming: Members Can Now Choose Between Peacock and Paramount for Free [https://cordcuttersnews.com/walmart-expands-free-streaming-members-can-now-choose-between-peacock-and-paramount-for-free/]
[2] Walmart's Membership-Driven Engine: Can It Sustain a ... [https://www.ainvest.com/news/walmart-membership-driven-engine-sustain-premium-valuation-crowded-retail-landscape-2508/]
[3] Walmart's Strategic Expansion of Streaming Perks in ... [https://www.ainvest.com/news/walmart-strategic-expansion-streaming-perks-walmart-competitive-edge-retail-membership-wars-2509/]
[4] Walmart's AI-Driven Transformation and Its Implications for Retailers and Investors [https://www.ainvest.com/news/ai-general-merchandise-retail-walmart-ai-driven-transformation-implications-retailers-investors-2508/]
[5] From models to agents: A new era of intelligent systems at ... [https://tech.walmart.com/content/walmart-global-tech/en_us/blog/post/wibey-announcement.html]
[6] Walmart's Resilience and Long-Term Value: A Blueprint for ... [https://www.ainvest.com/news/walmart-resilience-long-term-blueprint-sustained-retail-dominance-2508/]
[7] How VIZIO and Walmart Are Transforming Omnichannel Advertising [https://platformplus.vizio.com/insights/how-vizio-and-walmart-are-transforming-omnichannel-advertising?hsLang=en]
[8] Walmart's Digital Renaissance: A Strategic Blueprint for ... [https://www.ainvest.com/news/walmart-digital-renaissance-strategic-blueprint-sustained-retail-dominance-2508/]
[9] The retail media cage match: how Prime Day and Walmart+ squeeze ad budgets [https://www.thedrum.com/news/2025/07/08/the-retail-media-cage-match-how-prime-day-and-walmart-squeeze-ad-budgets]
[10] Walmart cites growth, new tools, to counter media pushback [https://adage.com/brand-marketing/retail/aa-walmart-retail-media-pushback/]
[11] Walmart's Retail Rewired Report 2025: Agentic AI at the ... [https://corporate.walmart.com/news/2025/06/04/walmarts-retail-rewired-report-2025-agentic-ai-at-the-heart-of-retail-transformation]
[12] How Walmart+ decides which new perks and services to add [https://www.modernretail.co/operations/how-walmart-decides-which-new-partnerships-and-perks-to-add-to-walmart/]