Three trends signaling permanent ad budget shifts to retailer ad platforms

Data-driven thinking“is written by members of the media community and contains new ideas about the digital revolution in media.

Today’s column is written by Andrea Leigh, vice president of strategy and ideas at Ideoclick.

digital advertising opportunities that they tried and adopted around this time. It is no coincidence that we are seeing an increase in retail media networks, such as Walmart, Target, CVS, Instacart and, of course, Amazon as brands see the value of reaching shoppers. online and grocery store customers.

It should be noted that these retail advertising platforms were born out of necessity. The shift from in-store shopping to e-commerce has reduced profit margins for retailers. Customers expect free delivery, so retailers are now responsible for the costs to the end consumer and come back often. To help reduce their profit margins, retailers are monetizing website and app traffic with the launch of advertising platforms.

Consumer brands need to place their bets now. And there is nothing for sure. Will online grocery shopping deflate when states and stores reopen? Are 2020 Budget Changes the New Normal?

I predict that new digital advertising platforms, and retail media in particular, will always gain traction and traditional advertising channels will not win a budget from marketers who have tried data-driven alternatives. .

Data is an obsession

Every advertiser knows the saying: “Half the money I spend on advertising is wasted; I don’t know which half. Traditional advertising platforms tend to provide “soft” metrics that leave brands in awe of the hard data they derive from digital platforms.

However, retail advertising platforms provide richer data, such as impressions, clicks, online conversions, and in-store attributed sales, to demonstrate that a campaign actually worked. For marketers, these direct KPIs are an addictive drug, creating a virtuous cycle of ever-active campaigns.

And while offline advertising typically locks brands into fixed prices, digital platforms have a lot more flexibility. Advertisers can set and adjust custom budgets for articles and keywords, and everything can be adjusted at any time. This is a benefit that has helped online advertising platforms maintain budgets last year, when budgets were often tight.

Retailer advertising platforms are walled gardens in a cookie-free world

TLDR: Third-party cookies disappear and it will no longer be possible to track customer journeys on the web or on devices without the individual’s permission.

Most businesses are not prepared for this data loss. Only 3% of participants surveyed for a “Digital Dialog Insights” study conducted by United Internet Media believes companies are prepared for the end of cookies. A large majority (71%) are unfamiliar with alternative tools.

We are entering a new era of consumer privacy awareness, and the rules of the game will continue to change. However, platforms such as Facebook and Google will be less directly impacted, as they are still allowed to follow their own users.

Retailer advertising platforms will also thrive, although they will not have their own media properties beyond their store site, as they are walled gardens as well.

Retailers can still collect and use data from loyalty programs, customer engagements in their stores and on their sites. It makes retail advertising platforms more valuable than ever. In fact, a major source of growth will come from non-endemic brands that use the platforms not to sell items on store shelves, but only to improve targeting and audience information.

Manufacturer’s profits are high and soar

Manufacturers who have quickly shifted to digital outdoor advertising (OOH) media, theatrical releases, in-store retail media and traditional TV advertising, are seeing their sales increase ahead of their peers. Plus, cuts in physical retail marketing due to reduced foot traffic have freed up dollars for data-driven alternatives.

As ad spend has shifted to digital platforms, advertisers have become accustomed to clear measures of return on investment, especially retail advertising platforms. Brands will take a critical look at ad spend that generates lower ROI; And the ad platforms that have helped preserve profitability in a downturn will continue to win, at least until mainstream media proves they deserve the expense instead.

Vaccinated shoppers will be returning to physical stores, but online shopping is not going anywhere. New habits have been formed which provide more speed and convenience. The coming years will bring not only more advertising platforms for retailers, but also increasingly sophisticated targeting capabilities, performance metrics and in-store attribution models. When you consider how digital advertising platforms can use the data of what’s going on inside, brands that choose to invest in that information will be richly rewarded.

About Timothy Cheatham

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