These retail media statistics every brand and advertiser should know
ritelo_admin | August 22, 2022
It is a well-known fact that the pandemic has accelerated the growth of e-commerce by at least a couple of years and has managed to get millions of new shoppers into the online shopping fold. And as the acceptance and propensity of consumers to shop at online stores increased, brands have started to leverage the ad placement opportunity on the retailer’s website to grab more eyeballs. Experts believe that the absence of third-party cookie tracking and tightening of privacy and security standards will propel retail media’s significance to newer heights as brands will increasingly move towards advertising on marketplaces and gain consumers’ attention when their intent to purchase is at its peak. There is no doubt that retail media networks, although still at a nascent stage, will grow rapidly and become one of the go-to marketing strategies for online brands in the coming times. This blog will highlight some key statistics that will help clear the picture of where the retail media network is heading.
Top Retail Media Networks in Numbers
E-commerce giant Amazon revealed that its advertising business surpassed the $31 billion revenue mark in 2021, making it the third-biggest digital advertising company just behind technology behemoths Google and Facebook. While its second closest rival in retail media, Walmart, the biggest retail company on the planet, generated revenue of over $2 billion last year from advertising as the company expanded its marketing technology stack.
Moreover, another e-commerce giant eBay is planning to double its revenue from advertising to $2 billion by 2025. The e-commerce marketplace touched $1 billion in advertising revenue in 2021 and hoped the digital advertising business could make up to 3 percent of all transactions on its platform.
$100 Billion Opportunity
According to global management consulting firm BCG, big retailers are already racing towards a $100 billion high-margin annual revenue prize in retail media, as it helps them to make better use of their customer’s data to help create better targeting and content. “We estimate that the retail media market will grow by 25% per year to $100 billion over the next five years and will account for over 25% of total digital media spending by 2026. Seemingly every week, a news headline trumpets the launch of a new retail media network, from Michael’s to Nordstrom,” said BCG in its report.
More Retailers Joining the Tribe
It is a well-known fact that Amazon has single-handedly driven the growth of retail media to date and has been the primary beneficiary of the move, where it generated over $30 billion in revenue from advertising in 2021. But seeing its massive success, dozens of big retailers have decided to join the party to cash on the growing relevance of retail media and how it opens up a significant revenue stream for them. In fact, a 2020 Forrester report predicted that retailers in the United States with more than 50 million monthly visitors on their websites would launch their own retail media networks. Apart from Amazon and Walmart, prominent retailers are investing heavily to ramp up their retail media capabilities, including players like Target, Kroger, Instacart, Wayfair, Best Buy, Home Depot, Macy’s, Walgreens, CVS, and eBay.
Apart from the statistics mentioned above, according to Forrester’s research, retailers and marketplaces in the United States are expected to sell approximately $40 billion in digital advertising in 2022, up from $29 billion in 2021.
Retail media has been taken up only by the big retailers as they have access to a large amount of first-party data and is seen as making them more potent while creating an uneven playing field for small retailers. But many digital marketing experts believe that the adoption of retail media will only increase in the aftermath of the pandemic. Most importantly, it is expected to disrupt the marketing and advertising space with all the uncertainty surrounding the future of data privacy and security.