“Why is your tea tasting different today, Rachna Aunty?”, I asked my maternal aunt innocuously last week during my customary fortnightly visit to her house, “There’s a nice aroma too which I never noticed before. And it’s certainly not your favourite Taj Mahal tea this time – I’m pretty sure about that, Aunty”.
Rachna Aunty was visibly happy that I noticed the difference in the taste of tea and very proudly confirmed, “You’re right beta, it’s Wagh Bakri this time and I was waiting to see if you can figure out the change and tell me if you liked this one’s taste better”. I quickly added, “It’s wonderful Aunty, good choice. But I’m curious to know what forced you to make this big change in your tea-drinking habit. Because as far as I can recall, both you and Ramesh Uncle have been loyal Taj Mahal tea drinkers forever.”
“Oh it’s nothing, I had opened the Flipkart app to order my groceries just like you had taught me last month and as soon as I typed Tea to order Taj, I chanced upon Wagh Bakri tea there. I had heard about this name from friends and thought let me experiment with a small pack to see if it’s really that good. And I am happy that like us, you too liked the tea. I think we’d switch to Wagh Bakri now”.
I was happy to know that my digital-laggard, septuagenarian Rachna Aunty had made some progress in her app usage journey and managed to shop online on her own. That she felt empowered enough to order confidently and choose a new brand for herself was a source of added satisfaction for me. What I didn’t tell her of course was that she hadn’t exactly “chanced upon” the new brand Wagh Bakri accidentally. That it was all part of a carefully orchestrated campaign that the digital marketing team of Wagh Bakri had engineered behind the scenes with the Flipkart app, would perhaps have dispirited her. The fact of the matter is that my unsuspecting aunt had of course failed to notice the “Ad” tag in fine print next to Wagh Bakri when she started to look for tea and in effect, she ended up becoming a converted sales metric for the brand marketing team.
For me, this little exchange was not just an reaffirmation of the inexorable march of the e-commerce brigade in India, but also a reminder of the growing influence of the advanced audience targeting techniques of retail media advertising.
As the media landscape continues to change and evolve, brands, companies, and online stores are restructuring their marketing approach and increasingly opting for retail media solutions. The goal of retail media advertising in simple terms is to reach consumers closer to the point of purchase (POP) and encourage them to buy a product or service – just as the POP material at the physical retail stores were meant to do, in the olden days.
The fact that retail media is already the fourth-largest digital advertising media vertical — estimated to be about 452 mn USD worth (approx. 3600 cr INR) – is ample proof that it’s a channel that’s headed for rapid growth. It more than doubled in size during 2019-2022, overtaking radio, OOH and cinema spends, according to a recent Dentsu Adex report.
With the rise of overall e-commerce business in India (estimated to reach approx. 100 bn USD sales by 2024) and the need to target “buying audiences” as opposed to just “planning to buy” audiences, retail media is becoming increasingly important.
Put simply, retail media can be seen as the advertising space available for sale on e-commerce platforms – including websites, apps, and other digital spaces where products or services are also traded. But in reality, it’s more than that. Retail media (as opposed to e-commerce media) encompasses all the various formats of advertising on those platforms as well as ads purchased through retail media networks that may not appear on e-commerce sites or apps themselves. So, in effect, retail media advertising covers all techniques that allow you to optimize buyer outcomes by combining performance advertising and commerce audiences, across the entire world wide web.
Retail media solution specialists now offer the ultimate solution for achieving growth-oriented business via a fully integrated data-driven platform for media planning, buying and optimization with access to a multitude of shoppers. They are helping businesses to strategize and execute effective online campaigns that deliver through the funnel results and thereby maximise ROI.
By and large, everyone knows that while Search is for targeting “intent” audiences and social media is used principally to target “interest” segments, retail media in comparison is meant to connect with the “actual shoppers”.
Retail media is a form of digital advertising that is best suited for reaching consumers who are actively amid the purchase journey. Because online retailers have access to a wealth of first-party data on consumer behaviour, they can deliver highly targeted and personalized ads to consumers across the web – outside of e-commerce platforms too – for example, on social media channels, and on mobile apps. Examples of retail media solution networks include Amazon’s DSP, as also those from Flipkart, Snapdeal, Paytm, Criteo, Carousel and Shopback. So while advertising on retailer websites is not a new phenomenon but using it to collect important customer data is a relatively newer idea. This data is then being used to shape the entire sales funnel, from the top all the way through to conversions. This is a highly effective way to market to customers, but important to highlight that it can only be successful if brands and retailers develop a robust data-backed plan.
Understanding Retail Media advertising is becoming exceedingly important for brands, as it provides a new, highly effective way to reach the spending consumers. Put another way, here’s an opportunity for marketers to target actual paying buyers and thereby reduce the probability of wastage.
Investing in Retail Media advertising is an effective way for brands to craft personalized shopper experiences that stand out from the competition. By creating more contextualized ads, brands are able to generate deeper engagement and increase brand visibility with relevant audiences.
Here are 4 key benefits of adding retail media strategy to your advertising toolkit:
• Get in front of high-intent shoppers: Shoppers are actively seeking to buy something – they’re in the research stage of their purchasing process. Brands can use this information to influence their customers’ decisions by appealing directly
• Learn detailed consumer information (first-party data): Bands can gain access to retailer first-party data, which is valuable because it reaches the very shoppers that brands want to reach
• Measure and track customer journeys in real-time: Retail media enables direct attribution because of the retailer’s ownership of digital assets. With this technology, numbers collected by website visit conversions become clearer for brands when it comes to analytics
• Increasing organic reach: Retail media campaigns can be used not only for paid advertising, but can lead to organic customer awareness as well
Retail media’s recent boom is not going to slow down anytime soon. As online privacy regulations tighten and the cookie-less world becomes a reality, more and more marketing managers will shift digital advertising dollars and marketing efforts to platforms and marketing channels that centre on first-party customer data.
As Dr. Karsten Wildberger, CEO of the MediaMarktSaturn Retail Group and an authority on digital advertising says “Retail media will be the main driver of digital advertising growth; the pie is getting bigger and it‘s time to get a slice!”
Sure, Amazon Advertising is likely to dominate Retail Media in the near term. However, many other players – such as Flipkart, Paytm, Myntra, Big Basket as well as new challengers, are expected to force rapid innovation in the space.
The advantages of retail media advertising are obvious and early adopter brands are already incorporating them into their existing marketing measures. The argument in support of digital retail media campaigns – that they are based on first-party data and can actually help to convert online shoppers into real store visitors – is indisputable.
Bottom line: procrastinators needn’t sit on the fence any longer but instead look to jump on to the retail media bandwagon and start converting all Rachna Aunties and their ilk soon.
First published on exchange4media.com on March 29, 2023