The importance of retail media platforms is growing every year. Initially, there were doubts about the potential of advertising, and even today many people still cannot accept the power of this opportunity. But the numbers have shown very good results: already in 2021, Amazon was able to sell $31.1 billion in advertising. This realisation has put retail media platforms on the back foot. It's got to the point where today, anyone who wants to be an innovative retailer is a bit of a media company thanks to retail media networks.
What is a retail media platform and what is a retail media network?
The retail media platform allows marketers and advertisers to buy advertising space on digital platforms under the retailer's umbrella, such as the website, the store's digital screen or even the app. The retail media platform therefore connects retailers, advertisers and consumers.
The retail media platform will add a number of features to the website, such as a self-service advertising portal that will make media sales fast and allow advertisers to make media purchases with just a few clicks. Retail media advertising comes in many different types and forms, including in-store digital ads, featured products, sponsored products in the website's results list, and even limited-time offers that cannot be missed. The retailer's website will be enhanced with an interface where ads can be uploaded and results tracked. These technological solutions are typically provided to the retailer by advertising technology providers.
There are many examples of retail media networks, including Amazon, WayFair and Walmart.
The Retail Media Network is made up of retailers and advertisers who form an alliance to be each other's resource. The retail media platform is therefore the platform itself, the website that allows advertisers to manage campaigns, and the network refers to advertising and demand. The two terms are therefore close but not quite the same, and are often used synonymously.
Boxed retail media platforms exist. They have the advantage of being very easy to deploy, integrate quickly and deliver results in a short time. However, this comes at a price, as developers get their hands on a share of the revenues. A retailer may decide to contract with an advertising technology company and build its own media platform. This is more complex than the former, requiring slightly more development time, but the retailer has full control over the revenues.
Why is there so much interest in retail media platforms?
With the development of e-commerce, consumer habits have changed and shopping behaviour has evolved. This has of course been influenced by the COVID-19 epidemic, which has boosted online shopping to an unprecedented extent. Retail media platforms are helping retailers to ride the wave of trends and significant traffic.
The justification for this technology is that the time of cookies is over, which also means that the advertising market is in a difficult situation, as solutions based on cookies, such as retargeting, are becoming more and more difficult. Not to mention the fact that traditional advertising is becoming less effective and does not reach the target audience, but can consume considerable sums of money. So new, alternative solutions must be sought by those who want to evolve and get closer to their business goals.
What needs to be done to keep retailers competitive?
Retail media is the third wave of digital advertising, the first being search engines and the second social media advertising. Retailers can compete in this increasingly competitive environment if they recognise the importance of data, and the need to capture and analyse it. This data is valuable to a retailer, but it can be even more valuable to another brand, to the point where they are willing to pay for it. This data can therefore play a very important role in forging profitable partnerships.
A multi-channel presence can be important for the success of a retail media platform. It is best to consider the potential for scalability at the start. Last but not least, a particular focus should be on the customer experience.
Creating a retail media platform is a profitable opportunity for all retailers. Inhabitad can help you learn how to do it well and successfully!
