As the retail landscape evolves, both Amazon and Walmart are preparing for a competitive shift in 2026, emphasizing the importance of monetization layers that extend beyond traditional commerce. This transition highlights a growing focus on services like advertising, data utilization, artificial intelligence (AI), subscriptions, and media distribution. The aim is to capture not only consumer demand but also attention and the economic dynamics of transactions, regardless of whether they fulfill them directly.
Despite their overlapping goals, Amazon and Walmart are adopting distinct strategies. Walmart leverages its physical proximity to consumers, while Amazon capitalizes on its digital presence. These differing approaches will influence their future expansions and innovations. Walmart is poised to transform its stores into experiential hubs that merge shopping with media, thereby enhancing customer engagement. In contrast, Amazon aims to seamlessly integrate commerce into various digital and AI-driven environments, making it less visible yet omnipresent.
Strategic Moves for Future Growth
Recent developments signal both companies’ readiness to adapt to an evolving market landscape characterized by tight retail margins and shifting consumer behaviors. According to a report from December 17, 2025, Amazon has reorganized its artificial general intelligence (AGI) efforts under the leadership of Peter DeSantis, a veteran of Amazon Web Services (AWS). This restructuring brings together AI models, custom silicon, and quantum computing into a unified organization, aiming to embed AI deeper into its retail and advertising operations.
The reorganization aligns with Amazon’s ambition to not just utilize AI, but to establish critical layers where AI becomes essential for sellers, advertisers, and consumers alike. For instance, recent findings from PYMNTS Intelligence revealed that during Black Friday, 42% of shoppers utilized AI assistants to locate discounts, while 31% compared products. This highlights the increasing reliance on AI as a commerce interface, blending content discovery with transactional capabilities.
On December 16, Amazon also announced that Fire TV users can now access Instagram in a new television experience. Aidan Marcuss, vice president of Fire TV, stated, “Our mission is to get you to the world’s best content fast, and we’re thrilled to welcome Instagram to Fire TV.” This partnership illustrates Amazon’s strategy of maximizing visibility across various platforms, reinforcing its goal to monetize user engagement wherever it occurs.
Walmart’s Retail Media Growth
Walmart’s recent growth in its U.S. Retail Media business, which saw an impressive 33% year-over-year increase, underscores the effectiveness of its approach. Retail media revenue is now a significant contributor, accounting for about one-third of Walmart’s operating income. This growth surpasses the company’s overall revenue trajectory, indicating that Walmart is successfully monetizing consumer intent rather than merely focusing on transactional sales.
The company’s performance is especially noteworthy in the current climate, where consumer spending is cautious and traditional digital advertising platforms face regulatory pressures. Walmart’s ability to thrive during this period underscores its advantage in harnessing first-party data combined with real-world purchasing behavior on a large scale.
Walmart’s strategy reflects a broader vision of transforming its retail operations into a complex ecosystem, where commerce serves as a foundation but monetization increasingly occurs through additional layers. This model closely mirrors Amazon’s evolution, suggesting that Walmart anticipates future retail economics resembling platform dynamics rather than conventional store-based transactions.
Both Amazon and Walmart are clearly positioning themselves for what they see as the next frontier in retail. As they build out their monetization strategies and adapt to changing consumer preferences, they are likely to redefine what it means to compete in the retail landscape of 2026 and beyond.
