This article is sponsored by Criteo Retail Media.
Ecommerce was on the rise long before COVID-19 upended the traditional brick-and-mortar retail experience. Even as shopping restrictions loosen in some parts of the country, many retailers and brands have watched online shopping behaviors continue to accelerate.
According to an August report from McKinsey, most consumers expect to continue making purchases online even after COVID-19 subsides – across many categories, from footwear, to consumer electronics, to household supplies and more. For traditional in-person shopping categories such as over-the-counter medicine, groceries and personal care products, expected growth in online shoppers exceeds 35%.
It’s clear that more purchases are shifting to e-commerce, and also that more e-commerce is happening outside of Amazon. In fact, in the first half of 2020, more than 10 million new guests shopped Target.com. In response to these massive shifts in consumer behavior, brands are adapting their marketing strategies, and leaning into Retail Media to reach shoppers with relevant ads on the sites and apps of their trusted retail partners.
Need #1: Connecting media to sales
For some time, brands have been shifting marketing dollars to Retail Media due to the benefits of increased transparency and granular measurement. Retail Media enables brands to tap into retailers' rich first-party data and measure true return on ad spend. In other words, with Retail Media, brands and agencies can address every part of the shopper journey in a way that is consistently accountable to sales results.
"While media budgets face heightened scrutiny due to an expectation that marketers in 2020 should be able to prove business impact, closed-loop measurement is no longer a nice-to-have. It’s a necessity,” says David Peterson, Vice President, Sales at Roundel. “What separates the best solutions in the marketplace from other versions of closed-loop measurement is how media partners tie data back to actual purchases, including in-store and online.”
Until recently, many brands were investing just a slice of the marketing budget into ecommerce. Oftentimes, these dollars came from physical retail trade or shopper marketing budgets, which now increasingly need to be reallocated to online channels out of necessity. Some brands have also carved off some digital dollars for Amazon, but the rest of retail hasn’t been considered by the CMO. Now, there’s a notion of digital shopper marketing across retailers, and it’s getting C-level attention at brands.
Need #2: Self-service capabilities and features
As brands invest more and more into the Retail Media channel, they also expect to have the same capabilities that they have in the rest of digital media ecosystem. This means that as a foundation, brands want enterprise grade self-service tools, and the ability to grant agency partners access to manage and optimize campaigns on their behalf.
“Earlier this year, we launched our Retail Media Platform, providing strong and powerful self-service tools that are always available to retailer, brand and agency customers to create and manage campaigns,” said Geoffroy Martin, GM growth portfolio, Criteo Retail Media. “But some of our customers voiced the desire to leverage tools they know and trust today, to manage campaigns on Amazon or Walmart, or even search and social campaigns. The idea behind our API partner ecosystem, for brands and agencies, is to allow them to leverage those platforms proven in their capability to drive success in Retail Media and ecommerce.”
According to Nich Weinheimer, ecommerce general manager at Kenshoo, this API partner ecosystem represents a critical first step to increasing adoption as Retail Media finds its footing. “Retailers want more demand for their high-margin advertising businesses. But it can’t be one player or demand provider that enables them to maximize scale. It needs to be an open ecosystem.”
Need #3: Efficiency and flexibility
Every retailer and brand relationship is unique. From a Retail Media perspective, each retailer can choose to offer certain ad formats, placements and audience targeting options. But brands want standardized ad specs and workflows to increase efficiency, as well as normalized metrics to understand performance across all of their retail partners.
Brand marketers who are used to buying other forms of media are also looking for flexibility and control in the Retail Media environment. There will always be use cases where brands are trying to drive a single retailer outcome or trying to spend a certain budget with a designated retailer. There are other use cases where brands may be required to spend budget across retailers, or where they are looking to leverage AI to optimize for performance across retailers. In the current climate, brands may also want to make campaign adjustments based on product shortages, shipping delays and other uncertainties impacting the shopper experience.
Getting in early
There is undoubtedly an advantage to being an early adopter. Even large brands, who have historically been conservative, want to be early adopters in Retail Media because they have seen smaller competitors build businesses from scratch by aggressively using platforms such as Amazon Sponsored Products. It becomes much more difficult to gain share and protect it once a space has been penetrated by all your competitors.
While Retail Media is still on Day One, the objectives from both a retailer and brand perspective are now clear. Now, it is incumbent on this ecosystem to continue to evolve to help retailers take advantage of this enormous opportunity, and to allow marketers the ability to customize their experience as needed to manage Retail Media campaigns successfully.