September 8, 2022
Ad Tech

Retail Media Tools To Defeat Digital Giants

Henry Kim

The world is watching as digital giants take over our biggest global industries, one by one. The next big battleground is retail media advertising. If today’s brick-and-mortar grocery retailers don’t fight to take what’s theirs, they’re at risk of losing their place on the battlefield. But if they act now, grocers can not only reclaim their market share — they can win.

The Shift to a Winner-Take-All Economy is Underway

In a devastating picture of the new global marketplace, Business Analyst Ray Wang’s Everybody Wants to Rule the World predicts two digital giants will dominate. He explains: “Facebook dominated social media. Amazon took over commerce. Google ruled search. Netflix won the streaming wars. With the global COVID-19 pandemic in March 2020, the gaps between winners and losers not only widened, but the pace of change also accelerated.”

While “digital transformation” was the catchphrase of the 2010s, the 2020s made it clear that the rules of the game have changed. Though many businesses transformed their models and engaged consumers, it wasn’t enough to win—as competition from nontraditional and adjacent players continues to increase.

The real winners are those who recognize first-party data as today’s most important asset. Examples of data-driven digital network efficiency are all around us. Google can dynamically adjust ad pricing based on search term popularity. Amazon can identify what products to promote in a particular market at what price for the greatest profit margins. This unfair advantage makes it difficult for smaller players to succeed, but not impossible.

How Digital Giants Are Taking Over Entire Industries

Digital giants like Amazon, Apple, Microsoft, Google, and Facebook have disrupted the marketplace by:

  • Owning the digital customer relationship: Digital giants pick up customers through partnerships, but retain information about customers in order to more effectively market to them. When a smaller brick-and-mortar grocery retailer partners with a food delivery app, for instance, customers soon bypass the retailer and go straight to the delivery app for their needs. Retailers then lose that direct line of communication with customers.
  • Controlling the data: Consumer analytics combined with automated inventory management hands digital giants the power of data-driven decision-making. Food delivery apps know precisely what foods are more popular in a particular area. They can then drive down costs, increase delivery speed, and completely dominate a segment by opening up dark stores with precisely the products local shoppers crave.
  • Monetizing all business models: Digital giants monetize advertising, search, goods, services, memberships, and subscriptions to maintain continuous revenue streams that allow them to reinvest in advanced capabilities and technology.
  • Focusing on long-term growth: Digital giants have access to investment capital that lets them fund massive losses in order to dominate the market. Retail giants like Walmart and Target took a similar approach during times of inflation by keeping prices low and taking a hit on short-term profit margins in order to win the long game. Of course, not every small or mid-sized retailer can sustain these losses and still survive.

Retail Media is the Next Frontier for Brick-and-Mortar to Leverage

Brick-and-mortar retailers still have certain competitive advantages over digital giants: notably, their physical presence, earned consumer trust, and the omnichannel shopping experience. Shoppers still like the convenience of being able to see and pick out merchandise themselves whenever they want. Retailers gear up for battle by investing in retail media infrastructure that drives consumer loyalty and margin-rich advertising revenue.

Personalize Experiences to Gain Grocery Retail Loyalty

Most retail customers prefer buying in person, but the majority still use their smartphones in-store to:

  • Access personalized deals, coupons, and loyalty program information
  • Look up additional product details on the retailer’s website or app
  • Compare prices, assortments, or inventory availability
  • Buy online and pickup in store or contactless mobile checkout
  • Scan QR codes to access digital promotions

In other words, mobile enhances the in-store shopping experience. Omnichannel retail platforms are much more than a convenient smartphone app for consumers by providing:

  • A window into shopper demographics, preferences, and behaviors.
  • A place for CPG brand partners to spend real-time advertising dollars to reach shoppers.
  • A leveraging tool for brick-and-mortars against the impending digital giant takeover.

Improve Profits by Capitalizing on the Digital Media Revolution

The US digital retail media advertising industry is set to surpass $50 billion in 2023. This fast-growing form advertising channel competes with the likes of Netflix, YouTube, Google, and podcasts to account for 1 in 5 digital dollars spent. While Amazon has traditionally held 80% of US digital retail media spend, a new retail media network is born every one to two months, offering greater choices for advertisers to expand their reach, access data, and strengthen their relationships with trusted retailers.

McKinsey reports that retail media delivers 3-5x greater advertising returns than traditional media buys. With that kind of ROI, brands are shifting bigger portions of the budget to retail media. In exchange, brands receive valuable first-party data insights that allow them to understand who is buying their products.

The ability to reach targeted audiences both digitally (as they’re using the retail app) and physically (as they’re browsing the aisles of a brick-and-mortar) represents a unique competitive advantage the digital giants can’t match. With so many convenient new delivery and checkout methods, in-store shopping remains more popular than ever, capturing 86.8% of the $5 trillion in retail sales purchased in physical stores.  

Swiftly Provides the Retail Media Tools to Run with the Giants

Retail giants like Walmart, Target, Kroger, Lowe’s, Walgreens, and Albertsons were quick to launch their own retail networks, using real-time first-party data to sell ad inventory and data. In fact, Walmart’s ad-selling business has already topped $2 billion in additional revenue. Unbeknownst to many market players, retail media tools are accessible for every budget—with the right tech partner.

Swiftly builds a full-featured omnichannel retail platform that lets retailers build revenue, capture insightful data, communicate with in-store shoppers directly, and personalize the shopping

experience to drive long-term grocery retail loyalty. Whether retailers need to build digital infrastructure from the ground up or have an existing app that just needs a few bells and whistles, Swiftly delivers everything retailers need to compete with digital giants.

Upgrade Your Digital Capabilities

  • A feature-rich turnkey mobile platform that users can download and use to shop
  • Back-end analytics capture to learn about consumer preferences and behaviors
  • Retail media tools that allow you to form brand partnerships and earn ad revenues
  • Retail tools such as loyalty program integration, pickup/delivery, digital coupons/circulars

Unlike other tech companies, Swiftly does not run off an SaaS business model—meaning brick-and-mortar retailers pay one upfront price to develop their digital capabilities with no ongoing monthly fees. Retailers fully own the platform.

For partners who wish to extend their in-house teams, Swiftly can offer access to expertise in marketing, fulfillment, and tech innovation for a small cut of advertising revenue — meaning we do well only when our partners do well.

Contact Swiftly’s dedicated experts in retail media lifecycle management. Request a demo or no-obligation quote and discover retail media tools that help you innovate and compete with the digital giants.