As retailers continue to grow their Retail Media Network (RMN) capabilities, UK shoppers are now more than twice as likely to be influenced by ads served to them on the websites of retailers they already shop with compared with marketplaces, according to research from Intellias, the software engineering and digital consultancy company.
Original research of over 1,000 UK shoppers by Intellias showed that over a quarter (26%) are now influenced to buy products advertised to them on retailers’ websites, and a further 17% are persuaded to buy items after being served ads on retailers’ apps. This compares to just 11% who are swayed to purchase products after being advertised to on third party marketplaces and 14% who are influenced to convert after seeing branded ads on social media.
This shift, Intellias suggests, points to the growing opportunity for retailers to use ‘owned’ advertising experiences delivered via their direct-to-consumer (DTC) channels to drive customer engagement and open up new retail media revenue streams. And with the impact of traditional advertising diminishing – a separate poll of over 1,000 UK shoppers by ADvendio showed UK shoppers ignore over half (56%) of traditional digital advertising and 54% disregard traditional search ads – consumers are now demanding a more ‘curated’ advertising experiences from ‘trusted’ brands.
Two-fifths (40%) of the consumers polled by Intellias said they would be more likely to buy items advertised to them by a trusted retailer, while a further 43% would be more likely to try out a new brand they hadn’t purchased before if a retailer they regularly shop with recommended it to them.
With retailers including Currys, which launched its Currys Connected Media advertising offer for 3rd party brands in December, and supermarkets stepping up their RMN capabilities, including Tesco, which will accelerate digital media in-store via a network of 1,000+ digital screens, RMNs are fast becoming a sizable new revenue generator for retailers. Insider Intelligence suggests revenues from retail media will surpass TV advertising by 2028, while WARC estimates retail media ad revenues will tip $124billion this year.
Alexander Goncharuk, Vice President of Global Retail at Intellias, commented: “There’s no denying the sizable opportunity RMNS present, both in enhancing closer connections and greater engagement with customers, as well as opening up new revenue streams by connecting third party brands and advertisers with conversion-ready audiences. We see this working particularly well where retailers can connect data from across their digital and in-store channels and overlay this with loyalty programme insights to offer hyper-segmentation for advertisers and brands. By tapping these predisposed-to-purchase customers, retailers can deliver greater engagement and campaign performance that significantly increases return on ad spend (ROAS).”
