I read with interest Peter Adams’ recent publication in Marketing Dive (2020), “Can revenue-hungry retailers rise to meet digital advertising's opportunity?” In 2019, for the first time, retailers spent more on digital advertising than on traditional media. The mere fact that only last year digital advertising spend exceeded that of traditional media surprised me; given the mushrooming amount of time that individuals spend on digital user interfaces such as phones, tablets and computers, or “screen time”, I would have thought that digital advertising trumped that of traditional media several years ago. Not surprisingly, the ad revenue alone of Amazon, a platform that has a well-established media network that can reach consumers and is employing new formats, is expected to grow 50% annually. As expected, this fast-paced growth in digital marketing has attracted competition for Google, Facebook and Amazon. Not only has Microsoft offered software tools to retailers to use data to inform advertising decisions, but also Walmart has launched a self-serve ad portal that allows advertisers to buy product placements using a bid-auction marketplace as mentioned in the article.
Legacy retailers such as Target and Walmart are leveraging their significant traffic and volume of data using internally developed data analytics and marketing infrastructure to provide additional advertising platforms for marketers. Adams notes that consumers’ data from retailers with a brick-and-mortar presence may provide additional insights concerning point of purchase and may help drive marketers’ purchase-based ad targeting. However, I wonder will this “precision marketing” work for small, new and innovative brands? Data-based algorithms built on previous purchases may aid in what Jeff Bezos has termed product “recovery,” but even with coupling purchase data to geographic, demographic and behavioral trends, can it aid in product “discovery”? No doubt, big data will shape the virtual “shelf space.”
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