Image source: TripleLift
As a CPG agency, we’ve seen an increasing number of requests from clients and prospects asking us to handle their brand’s retail media strategy. Traditionally, this was almost always geared towards in-store shopper marketing efforts like shelf hangers, end caps, promotional packaging, etc. Today it’s almost entirely digital: sponsored product listings, homepage takeovers, hero banners, and more. But those on-site placements need to flow directly through the retailer’s media group (Walmart Connect for example). Off-site media, usually in the form of programmatic ads, is becoming an increasingly popular tactic for retail messaging that can be managed with or without the retailer directly.
Survey Says:
TripleLift and eMarketer recently released survey results highlighting the increasing importance of off-site advertising in retail media strategies. Below are some of the key highlights.
Retail Media Growth:
Retail media is projected to be the fastest-growing ad channel in the US, with spending forecasted to exceed $110 billion by 2027. Off-site advertising is expected to lead this growth due to its ability to expand reach and achieve upper-funnel goals like brand awareness.
Advertiser Perspective:
Over two-thirds of advertisers view off-site advertising as essential for their retail media strategy, with over half planning to increase spending in the next 12 months. Advertisers are exploring ways to maximize off-site effectiveness, though challenges such as ease of implementation and scalability exist.
Retailer Perspective:
71% of retailers offering off-site advertising consider it essential, citing factors like increased revenues and satisfying client requests. However, challenges include poor user experience and difficulties in scaling campaigns beyond single networks.
Adoption and Investment:
Over half of advertisers plan to increase off-site spending in the next year, with programmatic activations expected to grow. Off-site spending is projected to increase by 64.1% in 2024, reaching $11.04 billion.
Challenges and Opportunities:
Challenges for advertisers include poor implementation, lack of consistency, and scalability issues when working with outside vendor or retailers. Opportunities lie in providing creative support, addressing pain points, and enhancing the user experience with collaborative partners like agencies who understand the business and marketing objectives of the brand.
Key Takeaway:
Collaboration between retailers, third-party partners like agencies, and advertisers is crucial to overcoming challenges and improving the effectiveness of retail media strategies.
At Hangar12, we believe the solution is to manage our client’s off-site media both directly with retailer partners and with our in-house programmatic media team. By working with the retailer directly we can cultivate ongoing relationships to make running media a painless experience for the brand. Additionally, we can run off-site retail media through our access to the Google DV360 platform to help address challenges on lack of transparency, limited inventory, and scaling effectively.
In the current market, there is undoubtedly a growing importance of off-site advertising in CPG retail media strategy and there exists a deep need for collaboration and innovation to address challenges and capitalize on opportunities for brand growth in this space.