September 1st, 2025: Best Buy Relaunches Its Marketplace, Target Earnings: Like a Slow-Moving Train Wreck, Upcoming RMW Commerce Events in Second Half of the Year, and Walmart Raises Revenue Guidance
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It’s September 1, 2025 and this is the Watson Weekly - your essential eCommerce Digest!
Today on our show:
Best Buy Relaunches Its Marketplace
Target Earnings: Like a Slow-Moving Train Wreck
Upcoming RMW Commerce Events in Second Half of the Year
Walmart Raises Revenue Guidance in Earnings Call
- and finally, The Investor Minute which contains 5 items this week from the world of venture capital, acquisitions, and IPOs.
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To hear new episodes of the show every Monday morning, subscribe now at rmwcommerce.com/watsonweekly and wherever you get your podcasts.
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[PAUSE]
BUT FIRST in our shopping cart full of news….
Best Buy Relaunches a Marketplace: Ad Revenue Is The Biggest Difference Now
While choosing a third-party provider to build a marketplace is a different proposition in 2025 than 2011 when it was first launched (build vs buy), there is quite another big difference.
Can you guess what it is?
My bet is that it's the freight train called Amazon's advertising business in particular, and retail media generally.
In 2016, Best Buy shut down their US third-party marketplace citing less than 1% revenue contribution - meaning, who cares???
Yet, in 2015 (let's call this the year Best Buy made the decision) Amazon's "Other" revenue was around $1B. (of which advertising was always projected to be the biggest component of this number). Raise your hand if you remember when Amazon did not even break out their advertising business?
In 2025? $61B. Just the Amazon advertising business alone is much bigger than Starbucks, Netflix, Nike, and Salesforce. Uh-huh. Somehow, this is easily forgotten.
And while Amazon does not break out operating margin for the ad business, you can pretty much bet this is one of their most profitable businesses. Some analysts model it 55% operating margin.
Think Best Buy would like a mulligan on its retail media decision?
The story of Best Buy in the past several years has been reclaiming better service to customers, as well as the profit contribution of warranties and other services. As Lowes CEO and others have clearly stated - the road to profitable media and service revenue truly runs through a marketplace model.
And while investment is needed, the payoff is super-clear at scale.
>> closer
[References:]
Our Second Story
Target Earnings: Like a Slow-Moving Train Wreck
Here are my four takeaways from Target's earnings call:
1 - Target Plus Marketplace remains shackled.
One of the only parts of the business with double-digit comps, as well as the key to unlocking more advertising growth, is still an invite-only affair. 6 years on, that is simply not good enough.
2 - New leadership smells like the old leadership.
Words like "enterprise acceleration office" and renaming categories of goods to "fun" sounds like gimmicks and warmed-over process reengineering than consumer excitement.
Target CEO steps down... from a slowly sinking ship NEXT FEBRUARY, replaced by a 20 year vet. New thinking to inspire fast action!
Key theme of this fast-moving speedboat? Process re-engineering through faster tech!
3 - Target still doesn't have a Chief Marketing Officer
In a world where marketing beats merchandising, this is an incredibly large gap. No update on the search. "Merchandising 4 Eva" bumper stickers seen at the Minneapolis HQ, followed by similar stickers like: "Our products market themselves."
Not in 2025 will this work. You are still not reading the room.
4 - Financial Analysts Increasingly Aggressive Line of Questioning
It was a little shocking to me to see some of these bold questions. You would think they were for a jilted lover, instead of a calm stock analyst.
What they asked / What they mean
Question 1
What they asked: "How does the succession plan improve business trajectory?"
What they mean: "Seems like the same group shuffled again, eh?"
Yikes. This was the starting point.
Question 2
What they asked: "Quantify investments in margin and capital to beat your peers?"
What they mean: "Please be more specific."
The answer included no actual numbers.
Question 3
What they asked: "How will the new succession plan help with your $15B sales target over 5 years?"
What they mean: "Did I mention be more specific?"
Answer just said we just had a sequential improvement on our negative comps!
Question 4
What they asked: "Please be specific about your merchandising and pricing strategies relative to your peers to grow the business?"
What they mean: "Like a pack of wolves, we will not let this same question drop."
Answer included the fact that they renamed Hardlines to "Fun".
This feels like a good place to end.
>> closer
[References:]
Our Third Story
Upcoming Events in the Second Half of the Year
There is a lot more upcoming in the next few months -- a new pod 'bout to drop, a refreshed media brand, planning for a new subscriber experience, and a slew of events in the back half of the year on the road to our 2nd annual RMW Commerce NRF Event.
The only way to ensure you are not missing out, is to subscribe to our mailing list. Link below.
* The launch of Oh Shift! -- exclusive interview with SVP and CEO-level leaders like Tomer on the collision between AI and SaaS, and the good and bad that is wrecking inside companies.
* MC and panel moderate at the Nosto Crayfish Party! (In New Orleans we would call it crawfish, but this Southerner understands the Swedes like Jim Lofgren).
* There is an upcoming panel discussion at the Rithum Live event that I will be moderating here in NYC.
* Podcasting at the upcoming Shopware Shoptoberfest event in Brooklyn. Check me out there with Jason Nyhus. Rumor has it Vinny O'Brien will be called by the pipes like Danny Boy.
* My man Nick Kaplan will be out in Chicago for the Shoptalk event.
* We are about to mark up an exclusive NYC RMW Commerce breakfast here in a moment.
Excited to see all this great content and events drop ...
[References:]
[PAUSE]
And Our Last Story
Walmart Raises Earnings Guidance in Earnings Call
Walmart said on their call that they have been building two P&Ls for some time. One retail P&L that everyone has. But another that really only Walmart and Amazon have at scale: which includes marketplace, marketplace commissions, membership, advertising, and data.
Late last week, Walmart reported FY2026 Q2 earnings. It's still sfae to say, Walmart is one of the best executing retailers right now. Here are the top hits across the business.
There are a lot of interesting callouts that we can learn from.
Overall
* 7,000 rollbacks last quarter, up 2,000 from the previous quarter. Grocery rollbacks up 30%
* 50% of incremental profit is related to advertising, membership, and marketplace. Repeat that back to yourself: 50%.
The Consumer & Tariffs
* lower & middle-income consumers trading off more than higher-income. Having to rollback more to compensate (2,000 more rollbacks than previous quarter).
* Walmart had a great Back to School which is predictive of Holiday. Top BTS items had lower prices this year.
eCommerce
* Growth up to 26% y/y (was previously at 22%).
* Fashion in particular has been great. ("Our fashion business has been great", says almost no one but Walmart right now)
* "Our share in eCommerce is still relatively low. Long runway." <-SCARY.
Advertising
* 50% growth globally y/y, 30% in the US
Marketplace
* up to 500M marketplace items
* Grew marketplace by 17%, globally
* 44% of marketplace sales are fulfilled by Walmart, up 250 bps y/y
Supply Chain
* 1/3 of same-day deliveries are under 3 hours
* 20% of same-day is delivered in 30 mins
* Previously covering 93% of country in 3 hours, will be at 95% by end of year.
* Lot of speed improvements in supply chain are being driven by Store fulfillment.
AI
* Improvements from AI are not hitting top-line sales.
* Walmart's investments are biased towards growth, but they are not producing growth so... what does that tell you? It'll be a minute for you too, folks.
* Created two new AI roles, one reporting to CEO and the other reporting to the CTO.
These results from Walmart have been coming from years of investments in marketplace, advertising and supply chain. The playbook is clear. The results are working.
Target is in the corner sucking its thumb.
Amazon has also getting faster, but through a completely different supply chain model than Walmart.
[References:]
https://www.linkedin.com/posts/ecommercestrategyconsulting_walmart-raises-2025-sales-guidance-the-tale-activity-7365710808749600770-OV1h?utm_source=share&utm_medium=member_desktop&rcm=ACoAAAABzTYBMEkpgbpDWbI9miv0bkNA3W2mE1I
It’s That Time Friends, for our Investor Minute. We have 5 items on the menu today.
First
DOSS Acquires Shopify Inventory Platform Genie
San Francisco-based ERP platform DOSS announced its acquisition of UK-based Shopify-native inventory platform Genie for an undisclosed amount.
Link: https://www.digitalcommerce360.com/2025/07/23/doss-acquires-shopify-inventory-platform-genie/
Second
LVMH in Talks to Sell Marc Jacobs
French luxury goods platform LVMH is reportedly in discussions to sell fashion brand Marc Jacobs for a reported $1 billion as part of a strategic realignment to streamline its portfolio of brands.
Third
Barrel Holdings Acquires AO2 Management, Strengthening Amazon Expertise
Barrel Holding, a specialized agency holding company, has announced that it has acquired AO2 Management, a full-service Amazon agency for an undisclosed amount. AO2 Management will operate as a standalone entity in the Barrel Holding portfolio.
Fourth
Magentic Emerges From Stealth and Raises $5.5M
UK-based AI agent platform for supply chain savings, Magentic, emerged from stealth, announced a $5.5 million investment, which will be invested in growing operations and product development.
AND FINALLY …
Rokt Acquires Canal to Expand E-commerce Offering
Rokt, a customer experience platform, has announced that it has acquired Canal. a distributed commerce infrastructure platform for an undisclosed amount. Rokt has launched Rokt Catalog, which provides it with expanded e-commerce capabilities.
Link: https://www.rokt.com/blog/rokt-acquires-canal-to-launch-rokt-catalog-expanding-ecommerce-offering
[PAUSE]
Did you know that RMW Commerce has another podcast? Check out The Watson Weekend for an unfiltered and lively eCommerce chat each week with me, Rick Watson, my co-host Jess Lesesky, and an array of interesting guests and topics. All focused on eCommerce. You can find the Watson Weekend by searching for it on iTunes, Spotify, or Youtube.
That’s all for this week! Till next time Watsonians.....
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Hi, I’m Rick Watson, CEO and Founder of RMW Commerce Consulting and host of the Watson Weekly podcast - your essential eCommerce Digest.
To hear new episodes of the show every Monday morning, subscribe now at rmwcommerce.com/watsonweekly and wherever you get your podcasts.
