The retail media market is booming. Global valuations predict the market will be worth more than linear TV by the end of 2025. With such lofty growth forecasts, brands in the industry may be asking ‘why the hype?’ Here are just some of the reasons why brands find the retail media opportunity so valuable.
Targeted advertising
Given that Google will be degrading third party cookies next year, a lot of the excitement around retail media is based on the heightened value of retailers’ first party data.
Commercially astute retailers are seeking to plug the gap brands face in powering targeted digital advertising with their own customer data. Today, brands that leverage retailers’ first party data can continue to create personalised and relevant advertising campaigns both within and outside that retailer’s estate.
In fact, digital targeting has never been so powerful: purchase data is a new overlay to already established digital targeting norms such as demographic and location targeting.
Point of purchase
Retail media isn’t a new discipline. Brands have long been leaning on media assets within physical stores or e-commerce environments to ensure visibility at the final point of purchase.
But brands that connect ever more sophisticated retail media with their wider brand marketing investment will ensure they win with increased category engagement. This is particularly important for CPG brands, which tend to have extremely low loyalty.
Enhanced commercial relationships
A value point not much discussed in today’s environment, but perhaps the most important one, is that retail media investment can support wider commercial agreements with key retail partners.
Retail media is unlike any other marketing opportunity, as retailers aren’t ‘just publishers’ – brands and retailers interact commercially across complex terms, of which retail media is just one. Getting retail media right with key partners can support the development of stronger holistic trading relationships.
Measurable results
Being linked to the point of purchase, retail media provides brands the opportunity to track the success of advertising campaigns in real time.
By monitoring key performance indicators such as click-through rates, conversions and sales, CPG brands can optimise their advertising strategies and achieve a higher return on investment (ROI).
Increased visibility
Retail media can help brands increase their visibility and awareness among consumers. By partnering with retailers to serve targeted ads, CPG brands can leverage the reach and influence of those retailers to expand their customer base and reach new audiences.
Enhanced customer experience
By partnering with retailers to provide personalised and relevant advertising, brands can enhance the customer experience.
Targeted ads can help customers discover new products, learn about promotions, and stay informed about relevant news and trends. This can increase customer satisfaction and loyalty, as well as drive repeat purchases.
Competitive advantage
Retail media can provide brands with a competitive advantage in a crowded marketplace. By leveraging targeted advertising and data-driven insights, brands can differentiate themselves from competitors and reach consumers more effectively. This can help increase market share and revenue.
Cost-effective
Retail media can be a cost-effective advertising option for brands. By leveraging the data and insights provided by retailers, CPG brands can create more targeted and effective advertising campaigns, which can lead to a higher ROI.
In summary, retail media represents a valuable opportunity for brands. This opportunity is not limited to the facilitation of targeted digital activation. Brands that win with retail media can nurture important commercial relationships, increase the effectiveness of total marketing spend, and optimise over time.
No comments yet