Over the last several years, the retail and digital industries have been on a journey to convergence. It goes without saying, this progression rapidly accelerated during the coronavirus pandemic. In fact, the U.S. e-commerce industry grew by an astounding 32.4% year over year in 2020. As a result, brands, advertisers, and digital marketers were forced to expand their approach as a way to thrive in a new environment. Here, we go more in-depth and explain several areas of impact for brands navigating today’s digital landscape.
The customer journey is no longer linear.
A major catalyst that led to the merging of retail and digital media is the evolution of the customer journey. Traditionally, brands could rely on proven tactics when targeting different layers of the marketing funnel. However, that’s no longer effective.
Today, shoppers can progress through awareness, consideration, and conversion phases on most platforms. Because of this, certain buying behaviors are no longer exclusive to specific mediums or platforms.
Further, e-commerce has grown well beyond direct-to-consumer websites. In fact, shoppers often buy a brand’s product on countless online marketplaces like Amazon, Walmart.com, and Instacart. Not to mention, within the last year or so, social media platforms have caught on and created their own e-commerce capabilities. And savvy brands have taken notice and invested accordingly.
Most of the above-mentioned channels also have advertising options. Considering this, buying platforms and media platforms have become one and the same. As a result, there’s an innate need for brands to invest in a multichannel presence, creating a new set of strategic challenges to consider.
Including retail platforms in your programmatic strategy is a must.
In light of retail and digital’s rapid evolution, programmatic advertising is no longer something nice to have. Investing in this area of strategy has become mandatory for brands to compete and scale.
Programmatic advertising makes it possible for brands to not only reach a broader audience but one of greater quality. And the data that becomes available to brands running programmatic campaigns is invaluable.
These insights are the key to creating metrics-based strategies and driving better results.
Amazon was at the forefront of these capabilities and it continues to push priority behind its demand-side platform (DSP). Further proof that programmatic is a necessity comes with Walmart’s recent announcement. Walmart Connect has officially launched its demand-side platform, Walmart DSP.
As retailers and platforms continue to prioritize programmatic advertising, the competition for audiences that can be reached and targeted is steadily increasing. And, as a result, brands are finding it more difficult to balance the options of where they should allocate their budgets.
A variety of retail platforms have access to data, shaping how media can be run to a brand’s benefit. Retailers have the advantage of shopping data and the ability to target on and off their owned channels. This combination has created a powerful tool for brands to use within their holistic programmatic strategy.
Budget allocation optimization is more important than ever.
Deciding where to allocate spend has always come with significant pressure. And that pressure is building without showing any signs of slowing down as platforms innovate to meet the ever-changing expectations of consumers.
The biggest challenge by far is taking an overall budget and deciding how to distribute those dollars across channels. When options are unlimited and you’re expected to be an expert on every new channel and tactic, this can seem impossible. To succeed and overcome competition, brands and advertisers must be confident in their decision-making.
To mitigate this pressure and optimize budget allocation, brands should set themselves up for success. You can start by allowing yourself the flexibility to revisit plans for spending on a monthly basis. This way you can make any last-minute changes based on the time of year and any new trends.
It’s also important to establish clear goals and objectives to serve as a north star for improved budget optimization. As digital media and retail platforms provide valuable possibilities, it’s critical for brands and advertisers to adapt and re-optimize across platforms based on data measured against goals and objectives.
This year and beyond, brands and advertisers have their work cut out for them. As retail and digital media continue to mold into one majorly complex conglomerate, the stakes will only become higher. If anything, we know for certain the way brands, advertisers, retailers, and shoppers interact is completely different than it was even five years ago. Subsequently, the way we market, strategize, and how we leverage technology has been turned on its head. However, it’s not all as daunting as it may seem. Brands with the proper support and expertise in their corner have more opportunities than ever before to engage with and convert shoppers.
If you could use the support of a strategic partner, please reach out. We'd be happy to jump on a phone call and discuss the possibilities for your brand.