Reason why retail media is gaining more prominence in AdTech world Share via

The alarming situation where marketers will have limited access to third-party data has taken the marketing and advertising world by storm. Brand marketers are continuously looking for ways to target their customers effectively once Google phases out third-party cookie tracking in the Chrome browser by 2023. Coupled with the limitations of most company’s to generate first-party data at scale, marketers are staring at difficult times ahead.

But this whole situation has brought retail media to the forefront. As brands and marketers plan their next move on how to advertise in the post-cookie world, retail media has emerged as the most obvious choice for efficiently reaching out to their customers.

So what makes retail media such a lucrative option for brands? Firstly, the fact that some big retailers are sitting on a humungous amount of first-party data generated through millions of users visiting their websites and mobile apps monthly and shopping on their platforms. Secondly, the retailers know the brand’s customers more than themselves. They have access to data on the consumer’s interest, purchase behavior, and much more. And lastly, retail media can serve the brand’s potential customers the same kind of personalized advertising as is possible by tracking the third-party cookie.

The popularity and the success of retail media amongst retailers can also be gauged by a report by Forrester, which said that retailers in the United States with more than 50 million monthly visitors on their websites would launch their own retail media networks to tap on the massive opportunity this channel brings in the changing marketing landscape.

On top of it, the pandemic has accelerated the growth of e-commerce by at least a couple of years, getting tons of new shoppers into the online shopping fold. And as the acceptance and propensity of consumers to shop at online stores increased, marketers have started to leverage the retailer’s first-party data by putting advertisements on their websites and apps to grab more eyeballs.

For most brands that rely on retail distribution, leaning on retail media becomes vital in the absence of third-party cookie tracking because of the minuscule scale of first-party data they can generate themselves. As for others, most of them cannot effectively use their data set, as either their data are siloed away in places like their company’s CRM or in website analytics. As a result, only a tiny fraction of available data is ever used.

While for brands, retail media is solving their first-party data problem and helping them target the correct audience and generate better sales, it is a source of the additional revenue stream in the already thin-margin e-commerce business for retailers. Our retail media platform Ritelo is helping clients in the MENA region to build scalable brand-funded media businesses, where they utilize the power of Ritelo’s DSP to generate revenue from offsite outreach across multiple locations and channels. Ritelo also ensures that clients get SKU level and category level mapping to establish contextual relevance.

Many industry experts believe that retail media will disrupt the marketing and advertising outlook going ahead, and it will only benefit from all the uncertainty surrounding the future of data privacy and security.

In fact, according to global management consulting firm BCG, big retailers are already racing towards a $100 billion high-margin annual revenue prize in retail media on the back of brands queuing up to benefit from their understanding of consumer behavior. Additionally, as per some estimates, the same report suggested that Amazon has already grabbed as much as $26 billion in 2021 revenue while other major retailers like Walmart, Target, and Kroger are moving fast to establish their positions.

Retail media will play a significant role in the absence of third-party cookie tracking and will soon become one of the core marketing strategies in brand marketing plans. Soon, brands will start allocating more funds to the retail media, fueling the growth of this additional revenue channel that retailers have created.