Digital advertising is being revolutionized as we speak.
Ever since the pandemic, things have changed for the good. Especially in the case of eCommerce businesses and Commerce advertising platforms, customers now prefer shopping online to brick and mortar (B&M) stores.
This shift has allowed businesses to promote their products more sophisticatedly than through demand-side platforms.
Yes, we are talking about retail media ad networks. Businesses are frantically trying to take advantage of this commerce advertising technique as sellers can now use first-party data to deliver a personalized experience.
Do you wish to leverage retail media ad networks as well? Then you’ve come to the right place. Without further ado, let’s talk about retail media and why you should capitalize on it.
What is Retail media?
Retail media is a commerce advertising activity where the retailer sets up ads for their product on their retail/eCommerce website. The retailers that place these ads are known as retail media ad networks.
In simple terms, the ads you see on eCommerce sites are called retail media. They are placed by the retailers that sell the product.
You would be familiar with these types of ads on Amazon labeled ‘Sponsored’ - this is an example of retail media. Amazon is one of the top retail media ad networks and has its own retail media platform called Amazon Advertising.
Is Retail Media Similar to Social Media Marketing?
In a way, yes. Retail media is similar to social media marketing. Both allow you to display digital advertising based on their actions on a retailing site.
However, there are a few instances where retail media gives you a better opportunity for sales than social media marketing:
|Retail Media||Social media marketing|
|You can display ads directly on retail sites||You can only display ads on social media|
|Uses first-party data||Uses third-party cookies|
|Better sales opportunity||The conversion rate is low|
|Customers will visit retail sites||Many customers don’t use social media|
The future of social media marketing is questionable due to the deprecation of third-party cookies. Retail media will thus emerge as the future of commerce advertising.
Why is Retail Media Popular Right Now?
Let’s explore some of the reasons why retail media has seen a surge in popularity:
E-commerce is Currently a Hot Property
The e-commerce marketplace has undergone a global transition since the Covid-19 pandemic.
With more customers flocking to online stores, businesses want to target them where they are - on the sites of their retail partners. Only retail media lets businesses place ads throughout a customer journey.
Rise of First-Party Data
Google is set to deprecate third-party cookies, which means retailers now have to solely target customers using first-party data.
This is like a blessing in disguise, as sellers will get access to the first-party data stored by marketplaces and use it for digital advertising. Subsequently, this has also increased the demand for retail media.
Equate Spends to Sales
Retail media is popular because you can easily link your advertising expenditures to sales.
With retail media, you can leverage digital advertising everywhere a customer goes so that the sales happen closer to the ad. This makes it easier to link a sale to a specific ad and activity even upto the product SKU level.
How and Why Should Marketers Use Retail Media?
If you’re a marketer, now is the time to leverage the power of retail media. When the third-party cookie deprecation happens, you’ll be one of the very few prepared for it.
Now, let’s get to the ‘how and why you should use it’ part:
Throughout a Customer’s Journey
One of the major reasons to use retail media is because it gives you an opportunity to display ads throughout a customer journey. With retail media, you can get a potential sale opportunity on every page a customer visits.
You can display digital advertising on:
- Home page
- Search page
- Category page
- Product detail page
Here’s what retail media will look like on a retailer’s search page:
Gold Mine of Data
As mentioned earlier, retailers can get access to first-party data as third party cookies will be obsolete soon. This will deliver them data like never before.
First-party data consists of not just the basic details like name, location, etc., but also a customer’s entire history right from their first visit to purchase, cart abandonment, impressions, visits, logging time, loyalty tiers, and more.
Retailers can effectively use this data to segment customers, create individual buyer personas, and target their ads to the right customer at the right time.
Better Sales for Retailers
When you let sellers access first-party data, they’ll be more engaged in your retail environment.
Due to highly-personalized ads, customers will be able to purchase relevant items more quickly and easily leading to higher sales. This is why you must add retail media to your marketing plans, as they can skyrocket your revenue.
Deliver a Better Customer Experience for Advertisers
The ultimate goal of marketers is to keep customers engaged and drive repeated sales. However, bombarding them with irrelevant ads will ruin their experience and push them away from retailers.
With retail media, you can use first-party data to deliver relevant ads to customers and simplify their shopping experience.
This will help you foster customer loyalty, and they’ll keep returning to your brand. Retail media is all about delivering a personalized customer experience based on the actions they perform on a site.
Hence, you must capitalize on retail media to provide a holistic shopping experience for consumers.
What are the Top Retail Media Ad Networks?
First-party data makes running ads on retail media ad networks engaging. It lets sellers stay with customers throughout their journey.
Let’s look at the top 3 retail media ad networks:
Amazon is by far the biggest brand in the retail media market, accounting for 89% of all retail media ad expenditure in the United States.
As of 2021, the e-commerce behemoth had over 200 million Prime subscribers in the United States alone. With these figures, Amazon is unrivaled regarding access to detailed transactional data.
In terms of revenue earned by retail media, Walmart Connect comes closest to Amazon. Walmart has long been the world’s largest retail enterprise, with over 240 million customers visiting its physical locations each week.
Walmart.com attracts approximately 100 million unique visitors per month. With its arrival into retail media, the retailing juggernaut intends to assist marketers in connecting with targeted consumers across its digital channels.
Walgreens developed the Walgreens Ad Group (WAG) platform as part of its continuous digitalization to capitalize on the first-party data acquired from the more than 100 million members of its myWalgreens loyalty program.
The firm has committed resources to make its network valuable to marketers, including the addition of an in-house team of data scientists to improve campaigns.
Retail media is a sophisticated way to reach customers. Access to first-party data will allow you to deliver a personalized experience to customers using digital advertising. You can display ads through retail media ad networks, persuade customers throughout their journey, and convince them to purchase products.
The death of third-party cookies has opened a new world of opportunities for retail media. The time to take advantage of retail media before everyone jumps on the same bandwagon is now.