Retail media is on everyone’s radar right now. To understand the current and future state of retail media and why it matters, we talked to our Customer Success and Sales teams. Commerce media is the future and the new kid on the block. But what is it and why should we care? Hear what Jenna Cavrich and Chris Feo have to say.
Commerce media is here
Estimated to hit $40B this year and close to $100B by 2025, the hunt is on to excavate as much of retail media’s projected ad spend as possible. However, given the numerous verticals that are expanding their retail media strategy to include any touchpoint within the commerce channel, it might be time to lower the retail media flag and hoist the LUMA dubbed, commerce media flag.
So why are Travel, Financial Services, and other verticals hopping aboard the commerce media ship?
- Authenticated and digital users (usually app driven)
- Consented data that provides unique insight into the household’s or consumer’s intent/purchase behavior
- Emerging focus on advertising being an important revenue stream for the future
With all this “data” at their disposal – why is it not smooth sailing for commerce media to build an ad supported business? What’s missing for them to acquire the alluring $100B treasure efficiently and effectively?
Building a loyalty program is much different than building ad products
Loyalty programs are the backbone to commerce media networks, however, creating a loyalty program is much different than building an advertising product. It requires commerce companies to bring on additional people, technology, and partners to execute flawlessly.
There are four areas to consider:
Organizing your data at scale
To successfully build an ad supported business at scale, data must be organized in a way that catalyzes action (targeting and/or measurement). However, this requires changes in company culture. Both the business and technology infrastructure must be updated. Additionally, companies must update their mindset around how they create and sell products.
We have seen this story before, with large opportunity comes the requirement for new talent. Where are we seeing commerce media companies recruit from? AdTech and MarTech. Whether it’s engineers or data scientists, business development and partnership leads, or even your direct sales team, the poaching has begun. To build a successful business around advertising, experts are needed who can navigate the waters.
Partner vs build
The Requests for Information and Requests for Proposals for any combination of agency, demand-side platform, supply-side platform, customer data platform, identity graph, clean room, and beyond are piling up. One trend is clear: commerce media companies are looking for partners that are collaborative and that can provide a true strategic partnership to take on the complexities that come with the transition away from retail media.
Identity will remain the keystone to success
All commerce media companies have some identity data which reveals a slice of their customer’s viewpoint. Yet, unlocking the broad view of these audiences is crucial to success. These companies need to use the “full pie” to see well-rounded profiles, to gain the reach required to access them across many channels, and to turn opportunities into revenue.
Why build on this category? Advertisers can finally close the loop with commerce media networks!
Commerce media companies with real-time transaction data enable advertisers to see true ROI on their ad spend when products move off the shelves. Measuring real product lift/sale touch points across multiple channels will put performance and measurement front and center. Programmatic was the promise for performance advertising. Well, commerce media may finally be what fulfills that vow, creating enough value for companies to make it a real competitor to social channels.
While retail media will always exist, the transition to commerce media is quickly emerging and is here to stay. The journey might not be a straight shot to perfect results, but the data, partnerships, and resources are out there and ready to hop aboard to help guide commerce media companies to success. Our ships might look different than Blackbeard’s, but the yachts at Cannes brought us closer to the goal of greater ad spend ROI than we thought.
Create a connected customer view with Experian Marketing Services
With our combination of robust online and offline data, we can help you capture data from all consumer touch points. Bridge the gap between the offline and online world for in-store measurement and attribution. Contact us today to learn how Experian can help you navigate toward commerce media success.