Retail media is a form of advertising that’s growing in popularity. It’s a way for brands to connect with consumers as they shop on retailer websites and apps.
It’s a powerful form of advertising that’s set to change the way people shop online. But what is it, and why should marketers care?
It’s a Way to Target Customers
Retail media is any advertising that aims to influence a purchase decision while the customer is browsing a retailer’s website or app. It’s also known as retail point-of-sale (POS) marketing or e-commerce advertising.
It is a powerful way to reach consumers actively researching products and weighing their options before making purchases. This makes retail media a highly targeted and efficient marketing channel.
When looking for the right retail media network, you should consider the quality of reporting and the range of digital assets they offer advertisers. The key is to find a retail media network that provides detailed analytics so you can track and understand the effectiveness of your ads.
Another critical factor is choosing a network with first-party data on buyer behavior, as it’s more reliable than third-party data. This means you can target customers based on their actual purchase figures instead of derived interests based on surfing behavior only.
Brands can use these networks to promote products on partner websites and apps and their own online platforms. This is an excellent way to increase product visibility and boost revenue. It also allows brands to create a stronger brand image amongst retailers.
It’s a Form of Advertising
Retail media is a form of advertising on retailer websites and apps. The goal of retail media is to influence sales throughout the customer’s journey from initial browsing to final purchase. This type of advertising is gaining popularity and has become a significant focus for many brands.
According to AdWeek, 74% of brands dedicated budgets for retail media in 2022, and eMarketer forecasts that US Retail Media Networks will exceed $52 billion in ad sales by 2023. These networks are digital platforms that provide retailers with coveted first-party audiences and the means to reach them through their websites or app.
These ads can be placed on various pages on the retailer’s site, including search results pages, homepages and product detail pages. They can also be incorporated into video content.
The primary forms of retail media include sponsored products and onsite and offsite displays. – Sponsored products: this type of ad appears in search engines such as Google when a shopper searches for a particular product, and it’s displayed next to and in the organic search results.
This type of advertising is popular among vast and small brands and can be found in several large shops such as Zalando or About You. This form of advertising is often accompanied by branded content, which also helps to increase brand visibility. Examples of these advertisements include the Puma collection on Zalando and the collaboration between Disney and About You.
It’s a Way to Generate Extra Revenue
A lot of retailers are generating extra revenue by offering retail media services. This helps them offset the effects of inflation and rising logistics costs. It also helps them keep their prices competitive and avoid quick product price hikes.
Retailers also use retail media to get their products in front of customers actively searching for them online. In turn, it increases their visibility and improves sales.
According to eMarketer, CPG brands increased their retail media spending by 62% in 2021. This is because it allows them to target consumers with personalized offers and increase conversion rates.
Another benefit of retail media is that it helps brands track their ROI more accurately than other forms of advertising. It also helps them track how much of their ad spend goes to actual sales, allowing them to make better strategic decisions.
Finally, retail media networks allow marketers to access first-party data from website owners, which can help them personalize their ads and increase conversions. This is important as marketers prepare for a cookie-less future and move away from third-party tracking.
In a post-pandemic world, where consumers rely more on digital shopping, retail media is becoming an increasingly valuable asset for marketers. It can generate extra revenue and attract new audiences, especially in global markets where brands still need to roll out robust web offerings.
It’s a Way to Generate First-Party Data
Retail media offers brands an opportunity to generate first-party data that are more reliable than third-party cookie data. This information can be used to target shoppers with relevant ads as they navigate the shopping experience.
Brands can use retail media to reach consumers at or near the point of purchase, enabling them to coax them into switching brands, trying something new or grabbing extra items to complement their purchase. It can also attract potential new customers interested in your products but have yet to buy them, using audience enrichment and lookalike modeling techniques.
Unlike third-party data, which comes from outside sources, first-party data is collected directly from your audience’s origins, such as demographics you’ve gathered, customer feedback, and the information stored in your CRM. This is the most accurate way to understand your customer’s needs and preferences and to deliver personalized marketing campaigns.
Marketers can then activate this data with targeted advertising strategies like targeting and suppression, which allow them to reach customers across devices and channels at the right time. This helps them maximize their ROI and increase ad campaign performance.
With a rapidly evolving data landscape, retailers and brands need to be more diligent about gathering, storing, sharing and analyzing first-party data. Keeping it safe, secure and fully consented to is critical to avoid regulatory repercussions.