Retail Media: what is it and what are its benefits?

In recent years, it has been observed that users’ purchasing decisions fluctuate as the market does. Advertising agents, especially in the retail sector, have found it necessary to include new advertising formats to reach all possible channels.

Within this framework of constant change, the so-called Retail Media emerges,which for some time now has taken on special relevance within the sector itself. So much so that the results place it as the third wave of digital advertising, with a growth last year of 10.23% compared to 2022.

Large retailers such as Walmart have embraced this advertising system, but what does it consist of and what are the benefits for brands, retailers and consumers?

What is Retail Media?

Retail Media is advertising hosted on retailers’ websites and applications. The objective is to monetize the content placed on these websites and make products and services of brands and retailers visible. Using the data, a system is created that positions the product within a list, but with a tendency to be “sponsored” that makes it stand out from the rest. The user who is browsing the web or application receives information related to what he is seeing but in a more exclusive way.

This strategy allows retailers to increase their revenues through this advertising system and gives brands the possibility to increase visibility. Thanks to this system, a more qualified audience and increased conversions are ensured during the decision process.

Retail Media Benefits

A segmented market for brands

The use of Retail Media is very interesting for brands. One of the benefits of this system is that the audience is segmented more effectively. The use of data enables brands to create specific campaigns based on the market segment they are targeting.

In this way, the product ads are targeted to those who are interested in it, offering them promotions aimed exclusively at them. While the user is browsing the platform, a display will appear with offers on products related to what he is looking at. Therefore, the consumer’s particular interest is highly targeted and is impacted in a more direct way, since a product of genuine interest is shown to them.

In terms of advertising investment, Retail Media makes it possible not only to create much more targeted campaigns but also to measure them more effectively without having to resort to third-party cookies. This helps to better manage advertising resources and reduce investment if necessary.

Therefore, the use of Retail Media allows brands to come into contact with their target at the point where it is most necessary to encourage purchase and exponentially increase the advertising impact.

New revenue for retailers

On the other hand, retailers also obtain many benefits from this system. Thanks to Retail Media, they get another source of economic income due to the advertising agreements that are established with the brands. Brands receive the necessary space to advertise their products and retailers get an economic compensation for letting them advertise on their website.

In addition, it means a growth of their online business, since they generate traffic and visits, thanks to which, the number of sales increases and, therefore, the average ticket per customer increases. In addition, information on shopping habits is also obtained, which can be useful for retailers to know their customers and how to lead them to make their purchases.

This increase in sales can lead to increased advertising investment by brands and new sponsorships on the retailer’s website. Therefore, it is not necessary that your revenue comes only from sales, but also from these types of agreements.

Less intrusive advertising to consumers

For consumers, Retail Media is a turning point. Thanks to this type of advertising, they can receive more personalized ads that are aligned with their buying interests and only at the time they want to make a purchase. In this way, consumers receive less intrusive advertising and the impact generated is greater, since they are contacted at a point in the funnel where they are more qualified to convert.

On the other hand, through the use of Retail Media,consumers can receive exclusive and personalized promotions for products they are interested in. This gives the brand added value and improved product visibility from the shopper’s point of view. So, apart from achieving a purchasing benefit, the consumer becomes more loyal to the brand and more likely to buy.

In short, thanks to this advertising revolution, all the agents involved obtain benefits. Retailers increase their sources of advertising revenue, brands increase their sales and consumers limit intrusive advertising, as they receive impacts on products in which they have shown interest.

Retail Media Monitoring to optimize your resources

Starting to use Retail Media is a major challenge for your business, whether you are a retailer or a brand, but also a huge benefit. To monitor the performance of this advertising resource it is important to have an analytical tool that gives you all the results instantly from anywhere in the digital environment.

If you are a brand, you will optimize your advertising spend thanks to the analysis of your campaigns where you will see their performance. And if you are a retailer, you will be able to see how to improve your sponsorship with your target product brands.

Therefore, it is advisable to have a Retail Media Monitoring tool such as flipflow,which will help you to have all the information in real time. You will be able to monitor your Retail Media campaigns by page or search term. In addition, you will be able to control the advertising investment more precisely to optimize the advertising expenditure of your campaigns. But not only that, you will also get data related to your competitors’ campaign spend and their distribution channels.

In conclusion, you will have at your disposal the most relevant information that will allow you to make the best decisions for your business.