According to Web Tribunal, the average American today is exposed to 4,000 - 10,000 ads daily. Whereas advertisements used to come in the form of print ads and tv commercials, now, they're everywhere.
While the average viewer won’t internalize each one, with that amount of exposure, we're more than likely to be influenced by at least a percentage of them.
This happens because of retail media networks; retailers are constantly promoting other brands' products and services to customers through their various channels.
So why should retailers hop on this retail media train? This article will cover the basics of retail media, the benefits of adopting this way of advertising, and how your retail business can benefit from it in the long run.
What is retail media?
Retail media refers to advertising and promotional activities that take place within the online or physical retail environment. It's a form of advertising where brands and manufacturers pay retailers to promote their products or services to the retailer's customer base.
This advertising can occur through various channels and formats, both online and offline, in physical stores and digital ones. It's closely tied to George Ritzer's concept of "retailtainment," which is the idea of making shopping more entertaining and engaging for consumers.
Example of a retail media network
Amazon is a major example of a retail media platform—according to MediaRadar, Amazon is a dominant force among retail media networks, commanding 37% market share in a space that’s estimated to be worth $100 billion.
In the case of Amazon, a customer may be shopping for one item online, and consequently, several retail media ads for related items appear for the shopper to consider at the peak of their customer journey. Working with a retail media network like Amazon advertising provides more product visibility for brands that may not get as much exposure as a big brand like Amazon.
What are the benefits of using retail media channels for retailers?
- Additional revenue stream: Retailers can generate significant additional revenue by selling advertising space and services to brands. This can be particularly valuable in an increasingly competitive retail landscape.
- Leveraging customer data: Retailers have access to a wealth of first-party data with their customers, including purchase history, customer insights, and consumer behavior. By offering retail media advertising services, they can monetize this first-party customer data and provide brands with valuable insights to optimize their advertising campaigns and marketing campaigns.
- Enhanced customer experience: When executed correctly, retail media can enhance the customer experience and improve customer relationships. Relevant and targeted advertising can help customers discover products they might be interested in, leading to increased customer satisfaction and loyalty.
- Competitive advantage: Retailers that offer effective retail media solutions can gain a competitive advantage in the retail media market. Brands may choose to pursue partner marketing with retailers that can provide better advertising platforms and opportunities as well as data insights.
What are the benefits of using retail media channels for brands?
- Targeted advertising: Retail media allows brands to target their advertising to specific customer segments based on shopping behavior and insights about consumer preferences. This precision targeting increases the likelihood of reaching potential customers who are more likely to make a purchase.
- Influence at point of sale: Retail media channels allow brands to influence purchase decisions at the point of sale. When consumers are actively shopping, they may be more receptive to product recommendations and promotions through product ads.
- Measurable ROI: Brands can track the performance of their retail media offerings using data and analytics. This provides valuable insights into the return on advertising spend and allows for adjustments to optimize digital campaigns. Creating measurable campaigns is vital to understanding the performance of the retail media channel.
- Access to exclusive data: Retailers often share valuable data and insights with brands as part of retail media strategy and partnerships. This data can be used to refine marketing strategies and product listings.
- Increased visibility: Retail media can help brands gain increased visibility and exposure within a retail network, whether online shopping or in-store. This can be especially beneficial for new product launches or established brands looking to maintain a competitive edge.
- Co-branding opportunities: Brands can collaborate with retailers and partner brands on co-branded campaigns and content, which provides an opportunity for brands to build equity and customer trust.
It's important to note that the success of retail media campaigns and retail marketing depends on effective targeting, creative content, and a seamless integration into the shopping experience. When executed well, retail media can be a mutually beneficial strategy for both retailers and brands, ultimately leading to increased product sales and customer engagement.
However, it's crucial to maintain a balance between advertising and the overall customer experience to avoid overwhelming or alienating shoppers.
How can I keep up with the changes happening in the advertising industry?
To keep up with the dynamic changes happening in the advertising industry and in retail media platforms, adopting an omnichannel strategy is a smart move. An omnichannel approach involves seamlessly integrating and coordinating your advertising efforts across various channels and touchpoints, both online and offline. Here's how adopting an omnichannel strategy can help you stay current in the retail media ecosystem:
Adapt to changing consumer behavior
Consumer behavior is constantly evolving, with people using a variety of devices and platforms to interact with brands. An omnichannel strategy allows you to meet consumers where they are, whether that's on social media, search engines, mobile apps, or in physical stores.
Consistent branding and messaging
With an omnichannel strategy, you can ensure that your brand's message and image remain consistent across all channels. This consistency helps build trust and brand recognition, which are crucial in a rapidly changing retail media landscape.
Omnichannel campaigns generate vast amounts of data. By harnessing this data, you can gain insights into consumer behavior, preferences, and the effectiveness of your advertising efforts. This data-driven approach enables you to make informed decisions and adapt your strategies in real-time.
Today's consumers expect personalized experiences. An omnichannel strategy allows you to collect and analyze data to create highly personalized advertising content and offers for individual customers. This personalization can significantly improve the relevance and impact of your advertising campaigns.
Adapt to new channels
As new advertising channels and platforms emerge, an omnichannel strategy allows you to experiment and expand into these digital channels while maintaining a cohesive brand presence. This adaptability is essential as consumer attention shifts to new technologies and digital platforms.
How important is my online presence when it comes to retail media?
Your online presence is exceptionally important when it comes to retail media. In the digital age, an online presence is often the cornerstone of successful retail media strategies.
Retail media in the online space includes advertising on e-commerce websites, mobile apps, and other digital retail platforms. Your online presence ensures that your products or services are visible to consumers who are actively shopping or browsing online. This visibility is crucial for product discovery and driving sales.
Your online presence is pivotal for effective retail media strategies in the digital age. To maximize the benefits of your online presence, invest in digital marketing, leverage data analytics, and continuously optimize your online advertising efforts. This will help you reach your target audience, drive sales, and remain competitive in the ever-evolving world of the retail media industry.
At Clientbook, we support our clients in participating in this new retail media opportunity through our clienteling software. As we've followed retail's digital trends throughout the years, we have seen that retail media marketing is here to stay.
The world of retail media is a dynamic and influential landscape that presents numerous opportunities for both retailers and brands. As we've explored throughout this article, retail media is not merely an advertising strategy; it's a powerful ecosystem where commerce, data, and marketing converge to shape the future of retail.
Book a demo to see exactly how Clientbook can help you with your retail media strategy.