Retail media has exploded with a bang.
In 2020 alone, marketers invested $20B+in advertising across retailers, including Amazon, Walmart, Target, and others in an effort to influence shoppers at the digital point of sale. In 2021, we have seen the rise of many more retailers following suit, and it seems that just about every major retailer with an online presence will either have—or soon have—a Retail Media offering for brands to invest their marketing budgets.
With ecommerce sales projected to reach over 19% of total retail sales by 2024, it’s critical for brands to navigate this high-growth channel. As the Retail Media ecosystem expands rapidly, how do brands decide which retailers are right for them and optimize their media mix across this growing list of partners?
And, how should they maintain a balance between online and offline tactics?
In a recent Cleveland Research Company Thought Leader Webinar, Navigating the Retail Media Bang, Skai™’s Peter Phillips and Advantage Solution’s Willy Blesener explore these topics and more.
Key Takeaway #1 – Brands are investing in Retail Media to take advantage of the ecommerce boom
Retail Media is now the third-largest digital advertising channel in the US. While other key channels such as Paid Search and Social Advertising are able to drive consumers to online retailers, Retail Media’s advantage is that the users are already there. This means brands can reach consumers while in a shopper mindset to either guide them to the purchase of their products or swoop in at the last moment and steal customers from competitors.
With Retail Media spending predicted to reach nearly $46 billion in the US alone by 2025, this channel is becoming an important opportunity for any brand that sells products online.
Key Takeaway #2 – The proliferation of Retail Media channels (and more to come)
“More people are shopping online so there’s more opportunity for us to merchandise and advertising to get our products in front of shoppers at the point of purchase,” says Phillps. “Retailers are coming up with full-funnel solutions for this.”
Key Takeaway #3 – Brands are facing hard Retail Media questions that they struggle to answer
Because Retail Media is still a bit of an emerging channel, marketers face many critical questions about how to do it right. Just some of those questions include:
- What retailers to reach new-to-brand consumers?
- How to grow & protect category share?
- How to drive higher sales during critical seasons?
- How to move excess inventory through online retailer partners?
- How to drive loyalty and lifetime value?
- What is the incremental value of investing in regional retailers?
- Which products to develop, update, or discontinue?
And certainly, the biggest conundrum for any marketer is to figure out how much to invest in a channel. As more and more retailers offer Retail Media advertising, the problem only gets bigger.
Key Takeaway #4 – The right data is critical for brands to make the right Retail Media decisions
For decades offline, shopper marketers have been tasked with accelerating in-store sales. They’ve done this by using a variety of tactics to reach the shopper at multiple points on their path-to-purchase. This may include demos, displays, and other in-store signage.
Online, digital shopper marketers are just beginning to understand how to use Retail Media to grow sales within ecommerce environments. It’s a different challenge than offline, where the shoppers are physically in the stores. To best understand how to drive the bottom line with their online tactics, digital shopper marketers require access to data to better understand how to engage consumers.
Phillps explains the different types of data required for an advanced digital shopper marketer program includes advertising & sales performance, category & competitive insights, and market insights & predictive trends. “But this can be challenging for brands,” says Phillips. “How do we get the cross-channel insight that’s going to help us invest our next dollar into the proper channel? It can be overwhelming. There can be so much data in just your advertising performance that you don’t know where to start.”
Blesener discusses that it’s the nascent state of access to today’s online retail data creates problems. “Brands look at this problem and it can be super intimidating. But the ‘good news’ is that no one’s doing this perfectly,” he says. “Some of this data can’t even be unlocked today. Getting access to this data isn’t available from every retailer, but we need this data to understand the impact of our advertising because it is inherent to our ability to better advertise. As this continues to change, as more data becomes more available, we’ll have to continue to restrategize because access to the data is constantly evolving.”
Key Takeaway #5 – Navigating the Retail Media bang requires commerce intelligence
Philips and Blesener agree that although data is the key to answering the hardest questions that marketers have about their ecommerce advertising campaigns, it’s not just having the data that is the final solution.
Commerce connectivity that bridges the gaps between data, insights, and activation is required to avoid siloing at any stage and ensure the very best commerce intelligence to drive Retail Media programs.
The right technology foundation is required for a best-in-class Retail Media program
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