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The Skai 5: Five Things to Know About Retail Media Advertising This Year

Skai™

July  11, 2022
retail media advertising fb

In our Skai 5 series, we discuss digital advertising tips, tricks & trends to keep you one step ahead of the consumers, the market trends and your competition. For this portion of the series, we highlight 5 retail media advertising tips for your organization.

Retail media advertising has always been about reaching online consumers during their shopping process. But over the past two years, the ways in which shoppers interact with brands online, from the research stage to final purchase, have shifted as more consumers embraced ecommerce during the pandemic. And in response, the retail media landscape has quickly shifted as well, and a slew of new publishers have made retail media advertising essential for brands looking to stand out on the digital shelf. 

Here are 5 retail media advertising tips you need to know this year:

How has retail media advertising changed in the past few years?

According to eMarketer’s recent report, “Retail Media 2021.” retail media advertising has been typified by the bottom-funnel search ads on retailer’s websites. However, this year has represented a sea change in the ways most advertisers think about the possibilities for retail media advertising. The advent of advertising tools such as video and demand-side platforms that can deliver ads on the open web has led advertisers to consider retail media advertising for attracting upper-funnel customers as well. 

Additionally, as privacy concerns grow, the first-party data that retailers have access to has led advertisers to consider the personalization potential of retail media advertising. Better tools and potential for targeting based on customer searches and purchase history stand to make right now an even bigger year for retail media advertising. 

woman sitting down at her work desk writing down business statsWhy should retailers invest in retail media advertising? 

During the pandemic, more shoppers moved to online shopping than ever before. eMarketer estimates that the US share of sales that occur online has jumped from 11% in 2019 to 14% in 2021. And while many consumers will likely go back to shopping in stores over the coming year, the ways in which shoppers are researching their purchases have changed.

Recently, Forbes reported that 74% of US shoppers begin their searches on Amazon. Whether they purchase from a third-party seller online or not, online product listings, reviews, and retail media helps consumers make their final purchase decision. 

Who are the biggest publishers?

Of course, there’s no doubt about the fact that Amazon is leading the retail media advertising charge. Amazon accounted for 76.2% of US ecommerce ad spending.

Amazon also offers advertisers the option of advertising across its many owned properties, such as Twitch and IMDB. Other retailers, like Kroger, are also capitalizing on partnerships with platforms like Roku to produce new, television-like advertising options. However, during the pandemic, many brick-and-mortar stores got into the retail media advertising game, with Walmart, Target, The Home Depot, Walgreens, CVS, and Macy’s all becoming formidable players in the market.  

Where should retailers be advertising?

The recent boom in retail media advertising is good news for retailers looking for ways to maximize their retail media ad spend. While Amazon has become a bit crowded by competition all looking to grab consumers’ attention in those critical searches, there are many platforms where early adopters can stand out.

Grocery delivery apps, like Instacart and GoPuff, are excellent places to experiment with sponsored search results and seasonal promotions in order to build a strong retail media advertising presence and claim share of voice. 

grouping of several retail companies from target to Walmart Connect

What kinds of retail media do consumers respond to?

There is strong evidence to support the fact that consumers actually respond more positively to retail media advertising than other forms of digital advertising.

As eMarketer notes, consumers most frequently report dissatisfaction with disruptive content that pops up when they are trying to read or play before a video. However, “native” advertising, as it applies to retail media advertising in the form of sponsored search results or recommendations, is often viewed more favorably.

In 2020, for example, the majority of Amazon Prime members reported that they had not had any negative experiences with Amazon advertising. The eMarketer report concedes that in prior research, Amazon customers, “relatively rarely said they notice ads on the site, even after being exposed to significant ad loads in search results. When they did notice ads, they were more likely to  characterize these ads as useful, helpful, or aligned with  their shopping habits than as distracting or untrustworthy.”  

As retail media advertising continues to grow, there’s never been a better time to get started! 

Get on the right track with a strong technical foundation

As part of Skai’s intelligent marketing platform, our Retail Media solution empowers brands to plan, execute, and measure digital campaigns that meet consumers when and where they shop. Built with best-in-class automation and optimization capabilities, our unified platform allows you to manage campaigns on 30+ retailers including Amazon, Walmart, Target, and Instacart all in one place. Client results include:

  • 461% increase in Amazon Ads ROAS and 57% increase in page traffic for Bondi Sands
  • 92% increase in share of voice on Amazon for a Fortune 500 CPG brand
  • 72% increase in revenue for VTech
  • 1,390% year-over-year sales growth for Kamado Joe

To learn more, schedule a brief demo to see our Retail Media solution for yourself.

Request a Demo

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Tags: Amazon, Create, Gopuff, Instacart, Measure, Optimize, Plan, Research, Retail, Retail Media, Target, Walmart, xPSx

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