More than half (54 percent) of U.S. consumers prefer to buy items advertised by trusted retailers, and 55 percent are more likely to try out new brands recommended by retailers where they regularly shop, highlighting the growing importance of retailer-owned advertising platforms, especially retail media networks (RMNs), according to Intellias, a software engineering and digital consulting firm.

Article Highlights

  • 52 percent of consumers ignore traditional digital ads and 50 percent ignore traditional search ads, presenting a unique opportunity for retailers to leverage their own direct-to-consumer channels, a separate study by ADvendio found.
  • A quarter of consumers are now influenced to buy products advertised to them on retailers’ websites, and a further 15 percent are persuaded to buy items after being served ads on retailers’ apps. This compares to just 13 percent who are swayed to purchase products after seeing ads on third-party marketplaces and 14 percent who are influenced to buy after seeing ads on social media.
  • Insider Intelligence suggests that revenue from retail media will surpass TV advertising by 2028, while WARC estimates retail media ad revenue will top $124 billion this year.
  • Samantha Giaver, Head of Global Sales at ADvendio, notes that retailers are “riding the crest of the latest digital advertising wave, with RMNs presenting a sizable opportunity for them to drive new revenues from third-party brands and advertisers.”
  • Highlighting the push toward RMNs is the expected eradication of third-party cookies for online transactions and diminishing returns from and higher costs for other more traditional advertising channels. This includes TV advertising, which Insider Intelligence predicts will be overtaken by RMNs by 2028.
  • This strategy seems to be proving effective, with a third of retailers in the ADvendio poll saying they see better engagement rates through RMNs compared to social media ads and 31 percent getting better conversion rates via RMNs compared to paid search campaigns.
  • “Growth in retail media will continue, and brands will get smarter with their dollars. Brands are starting to seek proof of performance, [which means] we’ll see winners and flatliners [within the RMN space],” said Jeffrey Bustos, vice president of measurement addressability data at IAB, in a statement.

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