Retail media networks have revolutionized the way brands advertise to consumers, but what impact do they have on consumer behavior? In this blog post, we'll explore the ways retail media networks influence consumer behavior and purchasing decisions. From targeted advertising to personalized recommendations, we'll examine the key factors driving consumer behavior in the age of retail media networks.
How retail media networks are changing the way consumers shop
Retail businesses should always be aware of how their customers respond to different business decisions and how they can adjust their offerings to serve them better. Here are some ways retail media networks have influenced the way customers shop in-store and online.
Customers are looking for product recommendations and information on multiple channels before making a purchase
Internet forums and social media have made it easier than ever for customers to find information about products that they intend to purchase. First-party information (directly from the business where they want to shop) can be viewed as less trustworthy than reviews and unbiased opinions found online.
Recent research shows that over half of shoppers read between 3 and 5 reviews about a business before making a purchase with them. Retail media networks have encouraged customers to look for these reviews more actively. Businesses can increase customer trust in their brand by encouraging past buyers to post unbiased reviews on their own sales channels.
Abandoned carts become a less likely outcome with highly targeted advertising
Abandoned carts are a common problem for e-commerce businesses, leading to lost sales and revenue. However, highly targeted advertising can help reduce the likelihood of abandoned carts by reaching the right customers at the right time with personalized messaging.
By using data insights and segmentation analysis to understand consumer behavior and preferences, e-commerce businesses can tailor their advertising messaging to match specific customer needs and desires. This helps build a stronger connection between the customer and the product, making it more likely that they will complete their purchase.
Highly targeted advertising can help drive revenue growth for e-commerce businesses, reducing the occurrence of abandoned carts and improving overall conversion rates.
Increased regulatory focus on data privacy makes retail media networks using first-party data more trustworthy
Data privacy is becoming an increasingly important issue for modern customers. In a recent survey, 84% of respondents said that data privacy is a human right and a similar number of respondents said that they should have full control over any data a company might have about them.
The increased regulatory focus has forced companies to plan for a future without third-party cookies. Businesses now have to find new ways to gather information about their customers. This makes retail media networks seem more trustworthy in the minds of their customers since they always know how the business got their data and how it is being used.
Customers demand more personalization from businesses when they shop
Customers today place a significant emphasis on personalization when they shop. Retail media networks provide businesses with a platform to deliver targeted advertisements and content to customers based on their browsing and purchasing behavior.
Businesses can show personalized offers, promotions, and recommendations to customers, enhancing their overall shopping experience simply by leveraging the retail media networks that they own. This not only drives customer engagement and loyalty but also increases the chances of conversion and repeat purchases.
The power of personalization: How retail media networks influence purchasing decisions
Personalization is increasingly becoming a necessity for modern retailers. As customers choose more personalized shopping experiences, retailers can use retail media networks to deliver these experiences to every customer. Here’s how:
Targeted advertising
The modern shopper receives a staggering amount of information in a day. Advertisements have become more pervasive and can cause a customer to simply disregard any advertisement they see. Businesses are under significant pressure to cut through the noise and make customers take notice of what they have to say.
Retail media networks allow businesses to gather information about what customers might be interested in and deliver advertisements that are more aligned with their needs, rather than adopting a spray-and-pray approach to digital advertising.
Pro tip: Use the data your network provides to customize shopping feeds when customers first visit your site, and show advertisements for products they might already be interested in, increasing the chance they’ll pay attention.
Personalized recommendations
Customers always give businesses some indication of what they might need or want through their browsing activity or past purchases. On third-party shopping channels, this information is often closely guarded and rarely shared with brands unless it directly involves their own products.
Retail media networks allow companies to gather more granular information about what products a customer is thinking about, how long they research it, and what purchases they made in the past. This can help businesses deliver personalized recommendations to customers who might be primed to make a purchase in the near future.
Pro tip: Once a customer makes a purchase or indicates an interest in an item, you can use that information to recommend products that are similar or complementary to the item they want to purchase to create opportunities for cross-selling and upselling.
Dynamic pricing and promotions
Sometimes, customers need a little nudge before they decide to make a purchase. While brands can plan promotions around festive periods and times of high shopping activities, retail media networks allow businesses to take more control over these promotions.
Pro tip: Observe how airlines often employ dynamic pricing strategies to maximize sales. You can use your retail media networks to do the same with individual customer profiles and customer-level browsing and shopping data.
Influencer marketing
Retail media networks provide opportunities for businesses to collaborate with influencers and leverage their audiences to influence purchasing decisions. When businesses partner with influencers who align with their brand and target audience, they can effectively reach and engage customers with authentic and trusted content.
Influencer marketing within retail media networks helps businesses build brand awareness, boost credibility, and drive conversions by leveraging the influencer's authority and the trust they’ve established with their followers.
Seamless integration of online and offline shopping channels
Online shopping has split customer preferences and a recent survey indicated that 55.6% of customers prefer online shopping while the rest prefer shopping at a physical store. Retail media networks give businesses complete control over their customers’ shopping experience. This allows them to ensure that marketing messages are consistent regardless of how customers choose to engage with the brand.
The future of retail media networks and their impact on consumer behavior
Amazon, Walmart, and Home Depot have all embraced retail media networks as a key component of their advertising and marketing strategies. These three major retailers have significant online and offline footprints, and leveraging retail media networks has allowed them to effectively reach their target audiences and drive sales across various channels. Amazon, for example, has built an extremely successful retail media network through its Amazon Advertising platform. Likewise, Walmart has been expanding its retail media network, Walmart Connect, which offers advertisers access to Walmart's vast customer base both in stores and online. Home Depot has also been making significant strides in retail media advertising with its in-house platform known as "The Home Depot Pro." The platform allows advertisers to reach the retail giant's professional customers through targeted display and video ads.
As retail media networks continue to evolve, they will continue to influence consumer behavior in a variety of ways. First, businesses will increasingly rely on effective conversion tracking to ensure their marketing spend is distributed optimally. With access to detailed data insights provided by retail media networks, businesses can monitor the performance of their campaigns and track the customer journey from ad exposure to conversion. This allows them to analyze the effectiveness of different marketing strategies, channels, and messaging and make data-driven decisions to optimize their campaigns and allocate their marketing budgets more effectively.
Furthermore, retail media networks provide retailers with access to more in-depth data about their customers and their preferences. Through the collection and analysis of customer data, retailers can gain valuable insights into customer demographics, behaviors, and preferences. Unlike the allocation of marketing resources, this data can help to directly increase sales once customers have indicated interest in any of your products.
The availability of such comprehensive customer data through retail media networks empowers retailers to make more informed decisions, enhance their marketing efforts, and ultimately influence customer behavior in a more targeted and effective manner.
MarinOne gives marketers the ability to use the information they gather from their retail media networks and apply it to their omnichannel communications. As customers spend more time across multiple social media platforms and websites, businesses need to be more careful about how they spend marketing dollars across each of these channels.
To get started today, schedule a demo with one of our MarinOne experts.
