January 1, 2024
The commerce media landscape is evolving, and in 2024, three key trends are reshaping the way businesses navigate it. Companies are using first-party (1P) data — data acquired from their customer base, subscribers, and site visitors — and advanced technology, like machine learning (ML) to optimize their ads experiences. Additionally, more businesses are handling their commerce media efforts internally, and embracing the full funnel marketing opportunities presented by Connected TV (CTV). The future of retailers and online marketplaces in this dynamic landscape depends on the ability to find smart ways to innovate and adapt their strategies.
In 2024, the forefront of commerce media trends lies in the era of hyper-personalized advertising, where the synergy of 1P data and machine learning elevates ads content to a level of relevance comparable to organic content. This evolution marks a pivotal shift in the dynamics of how sellers and brands connect with consumers, propelling a customization revolution.
Similar to organic content that uses advanced technologies to determine rankings based on context and user relevance in a dynamic and fast changing pace, ads content will be held to the same expectations of relevance. However, with ads content machine learning will need to take on the additional complexity of not only what is relevant, but also be closely integrated with pricing, bidding, budgeting, forecasting etc.
Marketplaces and retailers will be serving up tailored sponsored content, product recommendations, and ads that are fine-tuned and dynamically delivered based on a deep understanding of each consumer's behaviors and purchase history. This results in enhanced marketing messages that also create a real sense of connection and relevance with the audience.
In 2024, personalized and targeted advertising is not just a strategy; it's a dynamic and evolving conversation between brands, sellers and consumers. Each interaction is meticulously crafted to resonate on a personal level, marking a game-changing shift in how retailers and marketplaces engage and captivate their audiences.
Another noteworthy trend expected to shape commerce media in 2024 is the strategic shift by retailers towards reclaiming control over their advertising business.
In response to the complex nature of commerce media and the urgency to launch ads businesses, many retailers initially opted to outsource their advertising operations, relationships with suppliers, and technology to third-party vendors. Outsourcing was a great way to start up an ads business. While this seemed quick and easy, it disrupted the operating model between retailers and suppliers and raised questions on how retailer teams across marketing, merchandising and media could work together with the trade and brand teams on the side of the advertisers / CPGs.
As we approach 2024, retailers are reclaiming control over their commerce media capabilities. Industry leaders such as Kroger and Home Depot are at the forefront of this movement, bringing ad sales, operations, and technology in-house. They are recognizing the importance of establishing collaborative relationships with suppliers signifying a pivotal move from retailers to enable their valuable data and audiences. Striking a balance between in-house capabilities and strategic partnerships with commerce media tech providers will be crucial for retailers aiming to thrive in this evolving landscape.
2024’s third standout trend in commerce media will be the rise of Connected TV (CTV). With CTV ad inventory soaring, retailers and marketplaces are significantly shifting the way they approach advertising, by embracing full funnel advertising and blending the traditional television viewing experience with the data-driven capabilities of digital advertising. This opens up a new frontier of opportunities and challenges for retailers and marketplaces that will define a distinctive new era in commerce advertising.
A key aspect of CTV media for retailers is performance-centric, full-funnel differentiation. Retail media advertisers want and need measurable outcomes and tangible returns on investment across the funnel. Thanks to the expansive CTV inventory, they will be able to advertise on top-funnel content, leverage the unique data from retailers to enable audience targeting while driving performance and outcomes across the entire sales funnel. This will enable retail media platforms to fine-tune CTV strategies, optimizing ad creative and targeting parameters, and making placement decisions based on real-time data analytics.
As CTV takes a larger share of the commerce media landscape spotlight, its data-driven targeting is giving retailers and marketplaces a powerful tool to connect more effectively with specific audiences, enabling advertisers to engage the consumer throughout the funnel, while helping retailers build a larger ads business. With the integration of machine learning algorithms and programmatic CTV buying, there is huge potential for highly targeted advertising opportunities that hit the mark with viewers at just the right moments.
The commerce media landscape in 2024 will be marked by dynamic shifts and technological advancements. To thrive, retailers and marketplaces must embrace ML-driven ad optimization and targeting, establish in-house media capabilities, and navigate the evolving CTV space. Those who succeed will be poised to thrive in this new era of retail advertising. The key lies in adaptability, strategic collaboration, and a commitment to leveraging technology for a more personalized and impactful customer experience.
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