You may have heard about this little company called Amazon. It’s been over ten years since they launched the first Retail Media Network (RMN), and ever since, retailers have been struggling to figure out how to monetize page space to provide advertisers with value and bolster actual sales.
Struggles with formats and targeting have left many media buyers scratching their heads trying to figure out exactly what place RMNs have in a media mix. Due to increased consumer reliance on e-commerce throughout the COVID pandemic, we are now at a critical stage in considering the value of RMNs within a media mix.
So, what exactly is an RMN? In short, it’s an e-commerce platform that also serves ads. Besides Amazon, retail websites for Walmart, Target, CVS, and Home Depot are all great examples. Although RMNs are nothing new, their place within the customer journey has evolved to become a much more integrated player within paths to purchase. E-commerce—once considered the bottom-of-the-funnel—is now integral throughout the customer journey map. Product reviews, promotions, content distribution, and even live shopping events all influence consumers at various consideration stages.
As a media buyer, this means RMNs offer many interesting benefits. Let’s break some of them down:
- First, and perhaps the most influential consideration, is that advertisers have access to actionable first-party data. With consumer privacy at a premium, and with the looming demise of third-party cookies, the data retailers collect becomes a valuable commodity. Consider this: Amazon has Alexa, Whole Foods, and now iRobot. They can hear you, know what you like to eat, know what you like to buy, and they’ll have a map of your house right down to the location of your furniture and the dirty socks your teenager left on the floor. Scary, but potentially useful data for a media buyer.
- For manufacturers of consumer goods, RMNs also provide another means of supporting the retail partnerships already existing through merchandising. In a sense, utilizing RMNs is a way to provide supplemental “shelf space” in a digital world—giving a competitive advantage through higher brand or product visibility.
- Added exposure leads to a higher frequency which can help shorten lag times to purchase. While this may not be the case for all products or product types,for impulse buyers, frequency can have a massive impact on purchase behavior.
- The synergistic nature of RMNs leads to interesting co-op opportunities. Whether this is paid or organic in nature, driving traffic to purchase is a mutually beneficial strategy. Dividing both the cost and manpower to accomplish this goal is just smart business.
- RMNs can foster a better user experience. Blending advertising with the e-commerce experience is not unlike the brick-and-mortar experience of having banners or end caps throughout a store. It supports the user through their consideration process with additional information such as sale details.
- Finally, the ability to close reporting gaps is a massive win for media buyers. Product manufacturers have long struggled with closing data gaps due to the challenge of the supply chain or distribution process. Partnering at the point of sale effectively eliminates this issue.
As the retail season and the fourth quarter loom large in the minds of marketers, RMNs will only continue to grow—both in size and in their ability to support sales. For all the points above (and perhaps many more), there’s a strong argument that RMNs should not be overlooked as a serious player within the digital media mix.