Inside the Retail Media opportunity for SMBs
Retail media is exploding, in no small part due to retailers such as Target, Walmart, Amazon and Lowes who offer advertising opportunities to other brands to monetize their sites. These brands have been adding new capabilities to their services, including programmatic, enabling SMBs to reach the right person at the most opportune time.
For instance, In 2019, Target’s digital ad platform, Roundel, partnered with an ad exchange to offer programmatic advertising. More recently, it rolled out a tool for high spenders to track the number of users who see an ad and go on to make a purchase (this level of attribution is possible within walled gardens). Walmart Connect and Lowe’s One Roof Media Network offer similar functionality.
As a small brand, should you advertise via a Roundel, Walmart Connect and One Roof Media Network? In a word: yes! These sites, which resemble full-blown marketplaces more than they do traditional retail ecommerce stores, attract millions of consumers each day, many of whom are pre-registered. What’s more, their advertising tools allow you to target specific product categories and consumers, letting you reach them while their interest is piqued.
You may not have considered advertising with these sites before. Here are three reasons why small and mid-market brands are poised to reap the biggest benefits by doing so.
The opportunity is growing
Don’t think for one moment that it’s only household names that advertise on Amazon: over 2 million SMBs sell on Amazon, and they invest in search ads to grow their sales.
In February of this year, Walmart invested in Thunder Industries in order to “chase small business advertisers,” the Wall Street Journal reported. According to the Journal, Walmart plans to “launch a self-service tool that helps advertisers make and buy numerous versions of display ads targeting different kinds of consumers on its properties.”
Let’s say you’re a wellness brand and you sell supplements for bodybuilders, pregnant women and people who are aging. Walmart will allow you to create an ad that reflects these different markets, and target users with a message that’s appropriate to them.
Here’s the bottom line: As more retailers embrace programmatic media sales, more inventory is opening up for small and mid-market brands to efficiently buy retail media.
You can get in front of customers at the point of online purchase
Even before the pandemic, most customers began their purchase journey online, even if they intended to purchase it in-store. The pandemic accelerated that trend, prompting consumers to buy-online pickup in store (BOPIS). Research shows 67% of consumers have purchased this way, and by 2025,10% of all sales will be BOPIS.
What does this mean for SMBs? There are two key considerations. First, if you’re not part of the consumer’s sales journey, shoppers will have no opportunity to consider your brand (unless you spring for costly TV campaigns). You can’t be relevant to the consumer if the consumer never sees or hears about your brand. Business sustainability is a key issue here.
The second consideration is that of timing. You can target users for an ad as they actively read about and consider making a purchase in the category of products that you sell. Going back to the wellness example, you can target moms-to-be as they compare prenatal vitamins on Amazon, Walmart, Target and so on.
In some cases, you can target users based on past purchases, which is particularly strategic for brands that sell products, such as vitamins and personal hygiene items, that must be replenished at regular intervals. Think of this approach as securing digital shelf space.
There is a caveat you’ll need to consider: Retail media is only an opportunity for brands that sell products via the retailer’s marketplace. It’s important to build a workable strategy upfront, so plan on working with a trusted partner who can help you evaluate the market, maximize your budget, as well as test and iterate your ad spend.
Tie your media budget closer to inventory and sales
One of the key benefits of programmatic advertising is that it offers great flexibility in your media plan. You don’t need to place big bets on a particular ad that will appear in specific publications. You can change your strategy as you see fit.
Retail media takes that flexibility one step further, allowing you to closely tie your media strategy to pricing and inventory. For instance, you can promote items that are in-stock and you want to move (e.g., “Buy by midnight, get the second one 10% off). You can even tie your media strategy to outside events (e.g., “snowstorm coming this week; buy your snow tires online pickup today at store.”)
Although retail media offers a suite of self-service tools, it’s a good idea to work with your agency. Your agency will certainly bring significant expertise and experience in terms of creating ads and promotions, and continually optimizing retail media budgets based on demand and inventory levels.
Your agency partner will also keep an eye on the market for retail media opportunities that may arise in this fast-moving space.
Get in touch
Retail media is an excellent alternative to Google Paid Search and AdSense. You can target consumers who have a keen interest in your products and are actively making a purchase decision, and drive your promotions based on your existing inventory levels.