What’s a Retail Media Community?
The marketing and advertising industry is a fast-moving industry.
As technology advances rapidly, it is more convenient for people to do their purchases and other transactions online.
As digital interactions overtake personal activity, this lifestyle change means one thing for businesses – they need to spin fast. Otherwise, only customers can be lost.
Enter retail media networks.
What is a Retail Media Network?
As more people shop online, retail media just makes sense.
But what exactly is a retail media network?
A retail media network is when retailers set up an advertising platform on their website, app, or other digital platform on their network. This allows the business and other brands to advertise to customers on sites like CVS or Walgreens. It is a form of in-store advertising in a digital format.
Here is an example from the CVS home page. Notice the "sponsored" tag in the lower right corner. This is not just a list of products. It is an advertisement from a face mask company directly on the CVS website.
Retail media ads can appear on many sites including:
- The homepage
- Category Page
- Search page
- Product detail page
This allows advertisers to reach customers at different stages of their buyer journey.
The reason retail media works so well is because shoppers are more receptive to ads while shopping than they are in other non-shopping related activities.
Advantages and disadvantages of retail media
Retail media is changing the way shoppers and brands interact. But is this new form of advertising and marketing a good thing or not?
Let's take a look at the pros and cons of retail media and find out.
Advantages of retail media
We'll first examine the benefits of retail media and break them down by the actors involved.
For retailers
The main benefit of retail media for retailers is that it creates new revenue streams. Advertising is big business, and a retail media network enables retailers to tap into this $ 560 billion industry.
Consumer Staples (CPG) profit margins have been falling in recent years. Retail media income has been a lifeline for retailers looking to grow their profits.
Retailers using retail media have become the new media moguls thanks to the rise in e-commerce. This has opened up a new world of ways in which they can generate income.
For consumers
Buyers also benefit from retail media in a number of ways.
The first benefit is that it gives customers better price control. When retailers are generating revenue from ads, they can't increase their prices anytime soon. An increase in prices could lead to a decrease in traffic and lower advertising revenue.
Second, retail media benefits from customers by delivering a better customer experience (CX). Sure, advertising can be annoying. But when done well, they can help shoppers make better buying decisions. You can also remind customers of related products that they might want.
For advertisers
One of the greatest advantages of retail media for advertisers is that it gives them access to first party data.
First party data is data that is collected and owned by the website owner. In this case, it is the retailer. It's clean and more reliable than third-party data collected using other methods such as cookies.
The best part of first-party data is that it is collected right at the point of sale, so you can get a better understanding of buyer behavior.
Why is that so important?
One word: personalization.
Personalization plays a huge role in designing and running advertising campaigns that convert. To do this, you need precise data.
Another reason first party data has become so valuable is the impending death of cookies.
For brands
For brands promoting retail on media networks, the biggest benefit is that it's easier to tie ad spend to sales. Because sales happen closer to the ads, it's easier to associate a sale with a specific ad and promotion. This is critical to making strategic decisions like resource allocation.
Another benefit for brands is that these ads increase visibility and thus increase sales.
While it's still in its infancy, retail media is already proving to be a powerful form of advertising designed to transform the future of the online shopping experience.
Cons of Retail Media
Could there be downsides to such good looking retail media?
One of the biggest drawbacks to retail media is that it already gives big brands more power. This creates an uneven playing field for smaller brands that don't have the traffic, budget, and infrastructure to set up their own retail media networks.
Another drawback to retail media is that it is a new field that requires infrastructure that most retailers do not have. Because of this, it's a learning curve for everyone involved.
The Rise of Retail Media: Explained
Many brands had already jumped into the digital transformation market before retail media networks hit the market. They invested in mobile apps that customers could use to buy products and have them delivered straight to their home.
When the pandemic broke out, these websites and apps became instrumental in generating sales for retailers. Research shows that 80% of people now make more than half of their purchases online. The same study shows that 60% of respondents said they continued to shop online even after the pandemic.
What does this have to do with retail media networks?
Everything.
This shift in traffic to retailers' websites and apps led to a new form of advertising.
This new form of advertising comes in the form of media networks for retailers.
In a nutshell, it means brands are promoting on retailers' websites and apps. These can be brands that sell right in the store or brands that want to reach that store's audience.
Leveraging the already warm traffic to create retail media networks is powerful. This is because these networks benefit everyone from the retailer to brand promotion for the shoppers.
Brands with Retail Media Networks
Would you like to know what brands have their own retail media networks and how they do it?
Let's look at three brands that saw the change early on and are getting great results with their retail media.
CVS
Originally known as the Consumer Value Store, CVS has become a force to be reckoned with in the American retail scene.
CVS is one of the first brands to introduce its own retail media network called CVS Media Exchange (CMX).
With CMX, brands can place their products on channels that are informed about the first data from CV. This includes both external and targeted advertisements on site. When it comes to customer data, CVS has the edge over most retail ad networks thanks to:
- Almost 10,000 locations nationwide
- Decades of consumer data through their loyalty programs
- Highly frequented online platforms
With this huge database, advertisers are better able to create personalized ads and strategically place them for optimal visibility.
Walgreens
Walgreens is not going green when it comes to running digital advertising campaigns for other brands.
So it's no wonder that Walgreens decided to formalize things and create a retail media network called the Walgreens Advertising Group (Wag).
Wag offers ad placement in its online shop, in its stationary stores and on other digital platforms such as social media and Google.
Amazon
Retail and e-commerce giant Amazon is another brand that dominates retail media and operates its own network.
It's called Amazon Advertising.
Thanks to its huge digital footprint, Amazon can offer brands more in terms of the types of campaigns they want to run. They also get access to one of the world's largest customer databases and a large audience (over 200 million in the US alone).
Amazon Advertising works in a similar way to Google Ads. Brands wanting to be found have to bid for keywords and pay every time their ad is clicked.
Advertisers for retail media
How do they do it when most retailers don't have the infrastructure and expertise to run media networks for retail?
Most of them get outside help. Here are some of the top retail media advertisers who are driving the media movement in retail:
Criteo
Criteo is one of the leading advertising platforms for retail media. Thanks to their end-to-end service platform, they make it easier for media buyers to purchase retail media.
The platform gives brands and retailers full control over their campaigns and easy access to data and analysis. With robust APIs, you can also use the marketing tool of your choice.
Criteo is characterized by its transparent platform. For retailers, this makes it easier to expand their retail media network, while brands have more flexibility in choosing which retailers to work with.
Promote IQ
Another retail media advertiser that brands can use to promote their products on retailer's websites is Promote IQ.
Promote IQ was acquired by Microsoft in 2019 and gives retailers full control over the end-user experience. In this way, the retail media blend in seamlessly with the retailer's website.
Promote IQ claims they can help retailers get five times their sales by eliminating the middleman and working with brands directly through their platform. Promote IQ also offers automation functions to optimize and increase the effectiveness of your campaigns.
Brands get more visibility and higher conversions thanks to the powerful data and analytics platform of Promote IQ. This can be used to create hyper-targeted ads that will resonate with customers and increase conversions.
Elevaate
Another advertiser shaking up the retail media world is Elevaate.
Elevaate is aware of the problems retailers face in building a media network for retail. Because of this, they created a platform that is as easy to set up as it is effective in generating revenue. Elevaate enables retailers to maximize their digital real estate profits without sacrificing their customers' experience.
Elevaate promises higher visibility and a high return on ad spend (ROAS) through precise targeting.
How to create a retail media network for your brand
How can you set up a retail media network to grow your brand's sales? If your brand is getting a lot of traffic, consider using one of the tools mentioned above like Criteo or Elevaate.
After all, they have the infrastructure to get your retail network up and running quickly. This means you have more time to spend with your business.
For most of them, the process is as simple as applying to join their program. Once approved, upload your product feed and the ad network will do the rest.
Conclusion
The world is changing rapidly.
In order for companies to be successful in the future, they must adapt to the changing landscape and buyer behavior.
This is why you need to consider the retail media wagon if you haven't already – either by creating your own or by promoting it on major sites like CVS and Walgreens.
Not only does this give you a competitive advantage, it also helps you reach audiences that you cannot reach on your own. It will also help you maximize your marketing budget and make sure you are getting the best ROAS.
Did you use retail media for your brand? How was your experience