Will Brands Embrace Retail Media?
As with any technology investment, it’s natural for retailers to worry about adoption. Retail Media is no exception. If you launch Retail Media, will brands join the game or will they stay on the sidelines?
Fortunately, the answer to this question is out there in the open. If you are a specialty retailer, pick a well-known brand that you carry and look for its products on Amazon. In all likelihood, you’ll see a handful of products from the brand marked with a small “Sponsored” label.
What happens when a shopper clicks on the sponsored product on Amazon? Amazon makes money. What happens when the same shopper clicks on the same product on your web site? Nothing!
The question is not whether brands will embrace Retail Media but why you haven’t offered it to them yet. They already have budgets to sponsor products (e.g. 10-20% of their GMV on Amazon), and they spend these budgets with your competition.
Now, why are brands excited about Retail Media? There are a few reasons.
Retail Media is a reliable way for them to get their product in front of the shopper. Otherwise, they are at the mercy of the retailer’s algorithms.
Unlike Marketing Co-Op, Retail Media gives brands answers on what their money is being spent on, backed by data.
Retail Media is a lot closer to purchase intent than an ad you might see on a news website. Sponsored products, when done right, are highly relevant, including attributes like price, color, size, etc.
For every dollar spent on sponsored products, brands can expect to earn more than $4 in sales.
Conclusion
If you are a specialty retailer and don’t have a Retail Media program, you are missing out on a large revenue opportunity. Your brands already have Retail Media budgets, but they spend them elsewhere.
For a free estimate of your earnings potential, put 30 minutes on our calendar today.
