For years, retailers have advertised by buying ad placements across the web to promote their overall brand, products, and deals. However, in the past few years, retailers like Lowe’s and Best Buy are jumping on to a trend that we only expect to see increase throughout 2022: the rise of retailer media networks. Now, instead of buying ad placements on other networks, retailers are learning they can create their own network and advertise even more effectively to customers using the right messaging at the right time. In turn, the company is also able to utilize their vast databases of customer data and use it for even more targeted marketing.
Another benefit to retailer’s establishing their own media networks is the ability to sell ad space to other brands, generating an extra source of income for retailers who invest in this type of advertising. In turn, customers may trust this type of advertising more, as customer loyalty benefits often transfer to the network. This is especially important for retailers like Macy’s, who launched their ad network in August of 2020 and have heavily relied on customer loyalty programs over the years. According to marketingdive.com, after just six months of launching their ad network, Macy’s was able to generate ~$35 million in additional revenue from ad sales.
Walmart also has lofty goals for its own media network, hoping to become a top 10 US ad business in the next 5 years, according to Ad Age. Through partnering with the popular demand side platform, The Trade Desk, Walmart is on track to develop a shiny new programmatic buying platform to compete with the rest.
Why Does It Matter?
Lowe’s, WalMart, Best Buy, and Macy’s are just some of the major retailers dipping their toes into retailer media networks. However, as more brands enter the space and continue to develop their media networks, it is important as a marketer to be aware of what these changes mean for the ad landscape as a whole. Not only can media networks support revenue growth, they can also drive richer partnerships with brands and customers. In addition, with the decline of site cookies, more advertisers may opt to spend their dollars on these networks where they can get a stronger, more qualified customer response.
Sources:
https://adage.com/article/marketing-news-strategy/rise-retail-media-networks-and-implications-agencies/2376136
https://www.marketingdive.com/news/macys-touts-new-media-network-in-bid-to-sell-35m-plus-in-ads-to-brands/595610/
https://www.morningbrew.com/marketing/stories/2021/01/29/walmart-media-group-rebrands-walmart-connect-bid-become-top-10-us-ad-biz
https://adage.com/article/media/walmart-teams-trade-desk-ambitious-plan-become-top-10-ad-seller/2309321?utm_source=morning_brew
https://www.thedrum.com/news/2021/10/13/lowe-s-builds-its-own-ads-business
