What is retail media for? Part 2 There was more to unpack from my last post on r
By Sarahzmarzano · October 7, 2026 · Curated by George's Blog
What is retail media for? Part 2
There was more to unpack from my last post on retail media and retailer profitability than I could reasonably fit into 3,000 characters (ICYMI: https://lnkd.in/p/g2y23hrp). And following some interesting back and forth with Andrew Lipsman, Pablo D. Alvarez and others, I whipped up this visual.
This adds a crucial layer of context behind Walmart's topline margin stability. Between 2019 and 2025, ecommerce went from 7.7% to 22.5% of Walmart’s US retail sales. That’s an enormous shift in channel mix, and one that happened much faster than across retail overall, where ecommerce penetration increased from 10.8% to 16.8%.
And critically - Walmart US ecommerce didn’t become profitable until 2025. So for the majority of my original analysis, Walmart was rapidly shifting sales toward a channel that was still losing money, while maintaining a relatively steady operating margin.
We can’t draw a straight line between Walmart Connect profits and ecommerce losses from the outside. But we do know Walmart was absorbing a dramatic shift toward a still-unprofitable channel for most of this period, while its operating margin remained remarkably steady.
My original analysis showed little evidence that retail media has meaningfully expanded Walmart’s operating margin. But this helps illustrate why the absence of margin expansion doesn’t mean retail media hasn’t had a meaningful impact on the economics of the business.