In today’s post we will dive into what is Retail Media and why it is important, to better understand its potential as a sales ally.
While it may be tough to accept that your ecommerce is always competing with big online retailers, have you ever considered leveraging all this power to your advantage?
What is Retail Media?
Retail Media is the strategy of advertising where brands and companies can buy ad spaces within retailers platforms. It’s like you’re using the same approach of Google Ads, but inside of an Amazon store.
The difference in this advertising strategy is that the data is offered by the retailers, instead of third parties like Google Ads. This means that users have already given consent, so you need not to worry with consent mode tools, and besides that, you will be capable of using all retailer’s structure, driving offers to target audiences with precision.
That being known, it’s easy to see how important and worth it is to spend ad budget on retailers. In any department, good retail media work can put you on the top of searches, giving you an highlighted space where many users are with intent to buy.
Why is Retail Media important?
According to eMarketer, the investment in Retail Media will overcome Social and Search by 2026.
The 3° most used digital advertising channel in the USA can be an important way to lift sales for your store, and this is because, instead of competition, it can be used as a great complement to your operation.
In the biggest marketplace of Latin America, MercadoLivre, the number of active unique buyers in 2023 was 85 million. Now think of the advantages of having an entire structure ready to sell, with promotions being displayed all over the site.
Additionally, MercadoLivre gives you options to store your products in their distribution centers, allowing fast shipment of orders on Fulfillment mode. Almost 80% of orders delivered were sent in less than 48 hours, according to their 2023’s report.
Exciting news: MercadoLivre launched a distribution center in the USA in May 2024 to process orders for Mexico. Pretty cool, isn’t it?
Users are mostly intent to buy when they are searching in a retail store. More and more, consumers are turning to Amazon, Walmart or MercadoLivre to search for products rather than using traditional ways of search engines like google.
The doubling of spending on online advertising in the last two years, reaching US$41 billion according to eMarketer, highlights the significance of retail media. It’s predicted that for every five dollars spent on online advertising, one will be allocated to retail media.
These simple facts show us why Retail Media is important, right?
Retail media is the new Search?
As we could see previously, a big part of users with intent of buying online are searching directly on retailers channels. Check this out:
Analyzing this brazilian research made in 2022, it’s notable an decrease on search engines and social search compared to an increase on retail search.
The first big wave of online ads was search, which ruled the 2000s, followed by social media, led by Facebook. Now, retail media is called the ‘third wave’ of advertising.
We can witness a possible confrontation between Google/Facebook and Retailers, since the Third wave here is taking dollars aways from the ‘traditional’ way of online ads.
How can Ecommerce start on Retail Media?
Many brands are born on marketplaces, with people directly selling through retailers, so ecommerce companies can use this strategy to get this sales lift always wanted.
Consider Retail Media as a supportive ally to your traditional online advertising methods, by combining the two, you can enhance your efforts to drive more sales.
A good start is to use the most selled products in your ecommerce. Also, retailers care a lot about prioritizing a great product page, dedicating great images, videos, titles and descriptions.
According to the Retail Media Insights, a study made in Brazil with retailers, industries and agencies in 2023 created by Newtail, the most related points on why industries don’t feel capable to invest in retail media is the lack of knowledge and not having a team dedicated for this. This is an interesting insight, because besides ecommerces, many types of companies can indeed invest in retail media with the right investment in knowledge.
Technology for Retail Media
The next point at the same Newtail research is that brands don’t invest in retail media because of technology difficulties.
Advertising in retailers is the fun part, but to do this well, there is a storage and order process that needs to be well integrated with what system you use today.
Technology is an important point to consider, by reason that ecommerces well organized generally work with an Enterprise Resource Planning system (ERP), which with well integrated process, can lead a better organization for orders on retailers. Usually, good ERPs are well integrated with big retailers’ platforms.
Choosing the Right Retailers Platforms
To purchase advertising space in major retailers’ stores, is smart of yours to understand first what they sell and if your target audience is active on their website. These retailers commonly sell almost everything, and in diverse times there is a not explored field where you can take advantage of.
According to the 47°edition of Webshoppers, the segment of food and drinks was the third most selled category in 2022. It’s an example of a segment that is increasingly being more relevant in online retail.
Above, there is a list of retailers that are well known worldwide:
Amazon – The most known ecommerce in the world dominates the US retail media market, counting with a great variety of products and services, from electronics to streaming of video and food delivery.
Alibaba – One of the biggest ecommerce in the world, connecting chinese industries to global customers.
eBay – A global online marketplace known for its diverse range of products, eBay offers a unique platform where buyers can find both new and used items.
Walmart – Great prices and vaste offline presence, with stores worldwide.
MercadoLivre – The biggest marketplace of Latam, offering variety to customers all over the region. Value on the compromising of the seller with the clients.
All these marketplaces have diverse possibilities on ads and features that make them unique. For that, it is important to research these features and consider other retailers too, and even having more than one retailer to advertise your products.
Ads and Performance
One of the best advantages of retail media is using first party data to create personalized campaigns.
You’ll have many possibilities to advertise, such as native search or display, where the search is showcased with an ad tag and the display is usually promotion banners displayed on pages.
As you measure results in Google Ads and Meta Ads, you’ll need to keep a close look at the KPIs, ROAS and CPC metrics to take the best of your retail ad. That’s why it is important to research which platform or system each marketplace has to offer (Amazon Ads, Mercado Ads, Walmart Ad Center, etc).
The difference Between Onsite vs Offsite Retail Media
Onsite retail media refers to advertising within the retailer’s own platform, while offsite retail media extends advertising beyond the retailer’s platform to external channels.
With onsite retail media you can sponsor products to top web pages custumore’s search or display imagens and graphic banners.
In the other hand, offsite retail media envolvers advertising your retail space on platforms like facebook, linkedin, tiktok, or even through other external channels.
The difference really depends on what’s your strategy and also what you’re selling. Online retail media usually drive more results and offer more control, but offline retail media allows you to scale audiences across the entire web.
So, it really depends on comparing both strategies and testing what works best for you.
Concluding
A friendly approach to retailers is better than a competitive one. It’s important to consider that having an ecommerce, allows you to work on your branding, create unique features and have enormous marketing strategies, but with the big marketplaces offering retail media opportunities, you can really help your online store to achieve even more goals.
