As online shopping volumes have increased, retail media, which essentially means advertising on retail media network platforms, has become increasingly popular. This type of advertising infrastructure allows advertisers to reach relevant customers by relying on third-party resources to create advertising campaigns. What are retail media networks and what do you need to know about them? We've explored this for you in this blog post!
Retail media networks have emerged as a new face in the world of advertising. The power of automated advertising is hard to argue with, yet many people lack in-depth knowledge on the subject. We want to help them with this summary.
Retail media network is a new kind of advertising infrastructure. It is a collection of digital channels, such as a website or branded apps, that are owned by a retailer. On these platforms, advertisers can buy advertising space, helping them to further improve their marketing strategy, reach more potential customers and gain valuable insights about their target audience.
The power of retail media lies in the fact that it allows you to reach your customers at the right time and in the right place. By buying advertising space on the network's platforms, brands can get much closer to consumers. What exactly does this mean? Advertisers have access to data measured by the retail media owner, meaning advertisers can track shoppers and their buying journey. While the shopper is choosing, ready to spend money, it is in this state that they encounter the advertiser's related products. This can make the products advertised appear more relevant than if they appeared in Google's search results, for example. Think of retail media networks as shelves of promotions and promotional products in a store space, only these shelves are in the virtual space.
Advertisers who opt for retail media networks can therefore gain deeper insights into the behaviour of their target audience and understand their preferences. This insider information is golden for the business as a whole, as it can influence subsequent strategic decisions, marketing channels and campaigns.
The way the networks work is simple: the basic principle is that the retailer allows the advertiser to buy advertising space on the space it owns.
This type of advertising infrastructure offers benefits for the retailer, the advertiser and the consumer. Let's see how these players benefit!
As already mentioned, the retail media network allows you to reach consumers while they are shopping. This has already narrowed the field to those who are willing to spend money, i.e. to buy. The fact that consumers encounter advertising during the purchase process means that the ad is more likely to be remembered. Increasing visibility helps audiences encounter messages and products, which is key to conversion.
A not insignificant advantage is the possibility to get insider information about customers and their behaviour, which is an important factor from a strategic and marketing point of view. It can shed light on correlations that can later help to better allocate advertising costs and design, formulate and place messages.
The customer experience is particularly important in an era of unprecedented competition for attention in the online space. Consumers can be significantly helped if, while browsing a particular product on a retailer's website, they are also exposed to related brands and products. This will allow them to discover new brands and gain a deeper understanding of the topic.
In addition to advertisers and consumers, there is also the question of why it is worthwhile for retailers. On the one hand, the user experience mentioned above, and on the other hand, the retailer can earn extra revenue resulting from the advertising.
Retail media networks have a bright future ahead, as evidenced by the fact that consultancy Bain & Company estimates that businesses will increase their advertising budgets in retail media by $25 billion by 2023. It's up to you to join the innovators! If you decide so, Inhabitad can help you find out how!