Dive Brief:
- Vudu, Walmart’s subscription-free video streaming service announced Movies on Us, a service that provides movies and TV shows in 1080p HD at no cost but supported by ads, according to a company press release.
- Users can log on to the service via browsers, mobile devices or living room devices, such as smart TVs, gaming consoles or Roku devices, to access the free content.
- Vudu’s basic service allows users to buy or rent content while Movies on Us offers is Vudu's first foray into a free, high-definition streaming option.
Dive Insight:
In the release, Walmart pointed out that more than 42% of U.S. households now stream content at home, and the new free service looks to be a way to get users into the platform, generating ad revenue for Walmart as well as possibly encouraging them to stick around to buy or rent content that’s not offered in the ad-supported version.
What is to be seen is whether enough brands will be interested in advertising on a Walmart-owned platform to support the strategy. In the past, placing ads on retailers' sites has been a niche strategy typcially focused on retargeting. However, as retailers like Walmart develop more robust digital strategies that include content, interest is growing. For example, WPP’s programmatic group Xaxis said it intends to acquire Triad Retail Media to make it possible to leverage programmatic buying for ads on retail properties.
Walmart is looking to boost its video streaming strategy as the category continues to reflect strong growth potential, as evidenced by Netflix beating analysts' expectations for revenue and new subscriber growth during the third quarter. Amazon is also finding success here. Strong original content is one reason for this success, an area where Vudu could try to beef up if its advertising strategy is successful.
