Retail media revenues are essential for retailers, allowing them to competitively price goods. This has led to a surge in retail media networks focused on ad sales growth. Retailers can drive revenue through owned media on their properties or via audience extension ads on third-party sites. Owned media offers high ROI but is limited in supply, while audience extension ads struggle with lower performance due to the lack of immediate purchase intent. Consequently, retailers are increasingly leveraging both avenues to optimize ad revenue.
Retail media revenues are existential for retailers. Without profits from ad sales, retailers cannot competitively price their goods on the shelf.
The first is owned media, or selling on their own digital properties and physical stores... Advertiser demand for these placements is high; they tend to yield a strong ROI.
Larger retailers are expanding their footprint of owned media by developing programming, licensing sports rights, and rolling out ad-supported devices.
Audience extension ads have much lower response rates than on-site ads, due to the less-focused commercial intent of consumers.
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