Amazon, Walmart, and other retailers now offer marketers a way to advertise to interested shoppers while in their online stores—further down the funnel than ever before and at the point of purchase. In the Skai report, Commerce Advertising: Retailer Private Ad Marketplaces Cater to the New Needs of Manufacturers, learn about the meteoric growth of the commerce advertising channel.
How big is this opportunity?
Still nascent, it has grown faster in its first few years than Google or Facebook in their first years and is already the third-largest channel in digital advertising.
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Retailers must evolve to meet the new needs of manufacturers
For decades, the retail equation used to be quite simple:
Manufacturers made stuff
Retailers sold stuff
Consumers bought stuff
Fast forward to the modern era in which the Internet has shifted the power away from retailers and manufacturers and into the hands of shoppers.
In the Age of the Consumer, today’s buyers are savvy and have options. They desire real value. They read reviews. They watch product videos. They learn about new products from their friends and influencers on social media. With near-infinite selection and a wealth of information at their fingertips, consumers can make informed choices.
Manufacturers can no longer just rely on brand loyalty and traditional advertising budgets to meet their bottom line. In the face of so much disruption, manufacturers are making bold moves and rethinking legacy business practices in order to attract and retain customers. Whether that’s selling to them directly, offering a new breadth of products or services, or simply exploiting market gaps that have never been filled, manufacturers are becoming more active participants in the market than they ever have before.
The growth of online shopping is cannibalizing brick-and-mortar profits and the future is clearly moving in that direction. Manufacturers—which used to need retailers so badly to sell their goods—are finding new avenues to build direct relationships with customers. Consumers, too, browse retailer stores, figure out what they want, and then order from online competitors while still standing in the aisle.
Retailers are evolving to better cater to both of their core audiences:
- To align with manufacturers to help them execute their new market strategies
- To offer consumers new reasons to shop and buy from them
The Rise of Commerce Advertising
For decades, manufacturers have invested with retailers to help encourage sales of their products within brick-and-mortar stores. Co-op marketing budgets exist to push this agenda, and in grocery stores, it’s a common practice for CPGs to “pay-to-play” to ensure that their products are positioned on shelves at the all-important consumer eye-level.
Now, major online retailers such as Amazon, Walmart, Target, Ebay, Kroger, and others have set up commerce advertising solutions within their online stores to present manufacturers a way to grow that offline partnership investment strategy to the digital world.
The main draw for manufacturers to invest in commerce advertising?
Online retailers have tremendous first-party data and valuable and in-market shopper audiences that, when combined, offer the “holy grail” of marketing: the right message to the right person in the right place, at the moment of truth.
Read the new commerce advertising report
In this report, you will learn about:
- The rise of commerce advertising
- The 5 powerful value propositions for marketers
- The major retailers involved in the channel
- The infrastructure requirements to offer commerce advertising
- Whether retailers should build, buy, or partner to accelerate their solutions