By Wallace Witkowski
Walmart Inc. released two sites on Roblox Corp.’s “metaverse mega-platform” Monday, just in time for the holidays, and one of those sites is aimed squarely at a demographic the platform has targeted for needed growth.
The descriptions for one of those sites, Walmart Land, suggests Walmart /zigman2/quotes/207374728/composite WMT -0.52% is looking to accomplish a similar goal to Roblox /zigman2/quotes/223883423/composite RBLX +0.39% : Bringing older users into the game. Roblox executives have been targeting the teenage to mid-20s demographic — both those who are new to the site as well as retaining former tweens who have been users for years — and Walmart seems to have those same users in mind with “Electric Island” music festivals and “House of Style” virtual dressing room and boutique in the game.
Online concerts have grown in popularity since Epic Games Inc.’s “Fortnite” held its first virtual concert with electronic-dance producer Marshmello back in 2019 . In a recent poll of 401 consumer by MarTech, the marketing data site found that most surveyed, 68%, ranked “music” as their top virtual world experience they were interested in, with “travel/tourism” coming in at 58%, with “shopping/virtual stores” and “live events” tied for third at 53%.
Walmart appears to be targeting some of those most popular responses with its new release, writing in a statement that “Walmart Land will bring the best fashion, style, beauty and entertainment items directly to the global Roblox community of over 52 million daily users.”
Roblox has been trying to attract older users since it went public in March 2021 , noting in its filings with the Securities and Exchange Commission that the company’s ultimate goal was to “be a brand that serves all ages,” and that its 17-to-24-year-old user group had grown faster than its core under-13 age group over the nine months ended September 2020.
In an update earlier this month at the company’s investor day presentation, executives said that users aged 17 to 24 had grown 41% in the previous year, to 13.2 million, while users 25 and older had grown 28% to 10.2 million, according to JP Morgan analysts. Those analysts kept an overweight rating on the stock, but noted in their “risks” section that “an inability to maintain players as they age, or failure to incentivize developers to create experiences for older demos, could result in a long-term player base and spend level that is below JPM and consensus expectations.”
For more: Five things to know about Roblox as it goes public
Bringing brands known to older users as well as experiences that can attract them has been a goal for executives. While several results are returned for “Amazon” in Roblox, it if difficult to determine whether retail rival Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN +0.24% , has a comparable site on Roblox. Amazon had yet to reply to requests for comment at publication time.
“Universe of Play,” on the other hand, is squarely targeted at Roblox’s core tween demographic with immersive games with various licensed cartoon characters, reward games where users can exchange virtual toys they find for in-game coins, and virtual adventures where users can fly hoverboards through the universe and encounter things like a Sharper Image drone that features the hot toys for the holidays. The company statement described it as “the ultimate virtual toy destination in Roblox, just in time for those oh-so-real holiday wish lists.”
“Roblox is one of the fastest-growing and largest platforms in the metaverse, and we know our customers are spending loads of time there,” said William White, chief marketing officer of Walmart U.S., in a statement . “So, we’re focusing on creating new and innovative experiences that excite them, something we’re already doing in the communities where they live, and now, the virtual worlds where they play,”
Roblox shares closed up less than 0.1% at $35.55 Monday, while Walmart shares finished up 1% at $131.31.
Roblox has been in a bit of tailspin this year when it comes to bookings, or “revenue plus the change in deferred revenue during the period and other noncash adjustments,” important because Roblox sells virtual currency on its site that may be considered deferred revenue.
In May, Roblox shares came under fire after the company reported an unexpected decline in bookings, and in February, the stock logged its worst one-day performance since it went public after reporting weaker-than-expected growth in bookings, dropping more than a quarter of its value in one trading session, once it became apparent that once-stuck-inside kids were finding other ways to spend their time as COVID-19 pandemic restrictions began to lift.
During the past two quarters, the company has turned in back -to- back surprise declines in bookings. And shares fell a little less than two weeks ago when August metrics were released, and appeared to do little to inspire investor optimism.
Roblox shares are down 65% for the year, compared with a 23% fall in the S&P 500 index /zigman2/quotes/210599714/realtime SPX -0.19% , and a 31% drop in the tech-heavy Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -0.51% .