In a decisive move signaling a new chapter for retail media, Walmart Connect, the advertising arm of Walmart Inc., has unveiled a comprehensive artificial intelligence strategy designed to fundamentally reshape the landscape of digital advertising. Announced on January 6, 2026, by Vice President of Business and Product Marketing Khurrum Malik, the initiative is a proactive response to the transformative pressures of AI-driven commerce and positions the retail giant to compete directly with a new generation of autonomous shopping systems. At the heart of this strategic pivot is a sophisticated agentic advertising assistant, a new tool leveraging conversational chat to empower brands in building, optimizing, and troubleshooting their advertising campaigns with unprecedented ease. This launch marks Walmart’s official entry into what Malik describes as “an era defined by AI,” where the foundational methods by which brands connect with customers and measure their marketing impact are set for a profound and irreversible transformation. The initiative is not merely an upgrade but a complete reimagining of the advertising process, aimed at securing Walmart’s dominance in a rapidly evolving market.
Navigating the New Frontier of AI Powered Commerce
The retail media sector is currently navigating a period of significant structural pressure brought on by the rapid ascent of AI shopping agents. These autonomous systems, which can independently research products and execute purchases on behalf of consumers, pose a direct threat to the established advertising funnel by potentially disintermediating the traditional relationships between advertisers, retailers, and their customers. By creating a new layer of AI-mediated discovery, these agents could bypass the very channels that retail media networks monetize. In response to this existential challenge, Walmart’s strategy is one of proactive integration rather than defensive obstruction. The company aims to weave these new technologies into its own proprietary, monetizable ecosystem, a stark contrast to competitors like Amazon and Shopify, which have taken steps to block third-party AI agents from their platforms to safeguard their lucrative retail media businesses and maintain exclusive ownership of the customer discovery process. This strategic divergence highlights a fundamental disagreement on how to approach the future of commerce in an AI-driven world.
The tension across the industry is palpable, most visibly demonstrated by Amazon’s federal lawsuit filed against Perplexity AI on November 4, 2025, which alleged the unauthorized deployment of AI agents on its platform. This legal confrontation underscores the high-stakes battle to control the future of AI-powered commerce, a market projected to swell to nearly $300 billion by 2030. The industry-wide shift toward agentic frameworks is accelerating at a breakneck pace. In November 2025, several companies introduced agentic transaction capabilities, and on January 5, 2026, ad-tech firm PubMatic launched AgenticOS, with major agencies like WPP Media already testing its agent-led workflows. This rapid evolution is forcing a complete re-evaluation of advertising fundamentals. Analyst Karsten Weide suggests that as consumers increasingly delegate purchasing decisions to AI agents, “direct response advertising will fade,” while “brand advertising will gain in importance as we want to influence consumers before they tell their agent what to do.” This potential paradigm shift would prioritize building long-term brand affinity over immediate, conversion-focused clicks, signaling a sea change for the entire digital marketing industry.
Democratizing Campaign Management and Creative Production
At the heart of Walmart’s new strategy is its advertising assistant, a powerful tool currently in a beta phase for Sponsored Search campaigns within the Walmart Connect Ad Center and slated for a broader release in the latter part of the first half of 2026. This system operates through an intuitive conversational chat interface, providing advertisers with real-time answers and actionable recommendations on critical campaign elements such as bidding strategies, keyword selection, and billing inquiries. Its most significant feature is the ability to deliver personalized alerts based on account-specific conditions, moving far beyond generic advice to offer tailored, data-driven guidance that can be immediately implemented. The sophistication and immediate value of this tool are underscored by early usage data, which indicates that an overwhelming 97% of user queries are unique. This compelling statistic suggests that advertisers are not using the assistant for simple, repeatable questions but are engaging with it for highly personalized, account-specific optimization and complex problem-solving, demonstrating its capacity to address nuanced advertising challenges effectively. To further enhance its analytical power, Walmart Connect has also developed four advanced research reports accessible via the assistant’s chat, including Change Analysis and various Impression Share of Voice reports, providing advertisers with deep insights into performance and competitive positioning.
This advanced advertising assistant is a key component that will ultimately power Walmart’s overarching “Marty” super agent, which was first introduced in July 2025. This deeper integration is designed to drastically simplify the entire campaign management lifecycle, from initial strategy development to final execution. By utilizing plain-language guidance, the Marty super agent will enable users of any expertise level, from novice marketers to seasoned professionals, to manage complex advertising operations without needing specialized technical knowledge, thereby democratizing access to sophisticated advertising tools. Walmart’s AI strategy also extends far beyond campaign management, deeply integrating generative AI into the creative production process. The company’s Automated Creative Generator, which underwent beta testing in late 2025, yielded remarkable results, reducing the median creative production time by a staggering 80% for participating advertisers. This dramatic reduction allows brands to launch campaigns faster and allocate resources more efficiently. Complementing this is the Automated Brand Shop Builder, which now incorporates GenAI-powered lifestyle backgrounds for brand products, a feature particularly beneficial for small and medium-sized businesses looking to produce professional-grade ad creatives that can visually compete with those from larger advertisers.
Building a Proprietary Ecosystem and Leveraging Omnichannel Strength
A critical pillar of Walmart’s strategy is its proactive approach to integrating advertising directly into its own AI-powered shopping experiences, a stark contrast to competitors who are erecting walls around their platforms. Since the fall of 2025, Walmart has been actively testing advertising formats within its proprietary “Sparky” AI shopping assistant. This initiative represents a calculated bet that advertisers will see immense value in reaching customers through these new conversational commerce interfaces, which are rapidly becoming a primary mode of interaction for consumers. The results of these early tests have been highly encouraging. A custom survey conducted by Walmart’s Media Insights team in August 2025 found significant adoption, with 81% of surveyed Walmart customers reporting that they had used Sparky for practical pre-purchase activities like checking product availability and reviewing specifications. This high level of engagement demonstrates that Sparky provides genuine utility, fostering customer interaction and creating a natural, non-intrusive environment for integrated advertising. By building its own AI shopping experience and embedding advertising within it, Walmart aims to maintain direct control over its customer relationships and the monetization of its first-party data, effectively navigating the threat of disintermediation posed by external agents.
This forward-thinking strategy is bolstered by Walmart Connect’s unique omnichannel strengths and impressive market performance. The company successfully achieved 100% sponsored product coverage across tracked search queries in the second and third quarters of 2025, a clear indicator of platform maturity and saturation. Crucially, it also showcased the most balanced advertiser distribution among major retail media networks, with a long tail of smaller advertisers making up 75% of its ecosystem, a testament to the platform’s accessibility. The company’s advertising revenue surged an impressive 46% in the second quarter of fiscal 2026, a figure that includes the significant contribution from its acquisition of VIZIO. This strategic move provides Walmart with a crucial entry point into the lucrative connected television (CTV) advertising market, expanding its reach far beyond traditional retail media. This digital expansion is powerfully complemented by its massive physical footprint of over 4,500 stores equipped with 170,000 digital screens, allowing for unparalleled omnichannel campaigns that engage millions of customers at multiple touchpoints. Furthermore, Walmart’s 2021 partnership with The Trade Desk enables advertisers to leverage its rich first-party shopper data for campaigns outside of Walmart’s own properties, a pioneering move in privacy-centric data utilization.
Forging the Future of Agentic Commerce
Ultimately, Walmart Connect’s comprehensive AI strategy represented a multifaceted and aggressive response to the evolving dynamics of autonomous commerce. The initiative was built upon a dual approach: on one hand, it equipped advertisers with powerful, AI-driven tools like the advertising assistant and creative generators to reduce operational friction and dramatically enhance campaign effectiveness. On the other hand, it actively integrated advertising into its own customer-facing AI agent, Sparky, thereby ensuring it retained critical control over the customer journey and its valuable troves of first-party data. By fostering an ecosystem where artificial intelligence augmented human creativity and strategic judgment rather than replacing it, Walmart positioned itself not just to survive the burgeoning agentic era, but to thrive within it. The company’s vision extended to a future where creative assets could build themselves from product pages, campaigns could predict customer intent and optimize spending in real-time, and measurement could evolve from backward-looking reports to predictive, cross-channel insights. This holistic investment in AI infrastructure—spanning creative, campaign management, analytics, and the shopping experience itself—was a strategic bet that would define its competitive standing as artificial intelligence continued to reshape the very fabric of commerce and advertising.
