Retail Media Networks Are One Of The Most Important Trends Of 2022, But They Need To Evolve?

Amazon released its Q4 earnings on February 3, which included the disclosure that Amazon had sold $31.1 billion in ads on its platform in 2021, making Amazon a bigger advertising platform than YouTube.?The emergence of retail media networks is timely. As consumers shift more of their spending online, retailers struggle with the lower margins that often accompany digital sales. Incremental revenue from retail media networks is one way for retailers to offset the eroding margins of digital sales

At the same time, privacy changes at Google?GOOG?+5.2%?and Apple?AAPL?+3.5%?have made other forms of digital advertising less effective. Meta estimates that privacy changes may have?cost Facebook $10 billion?in advertising revenue in 2021 alone. The root of these privacy changes is that it is now more difficult for digital ad platforms to know what actions a consumer takes after seeing an ad. Retail media networks are a notable exception because consumers purchase products directly from the retailer after seeing the retail media network ad, putting retailers in a unique position to offer closed-loop marketing in a way that other digital advertising networks now struggle to do.

Given all this, it’s clear that retail media networks are a significant part of the future of retail and one of the most important retail trends of 2022.

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