Retail Media and Marketplaces in 2022 – A European focus

Retail media has emerged as the internet age’s trade marketing. It is led by pure players, and its expansion is encouraged by the continued rise of ecommerce at rates of 15–25% per year. The system is supported by a shift in consumer behavior from product searches in traditional search engines to searches in retail channels, as well as the continual collecting of monetizable user data.

The third wave of digital advertising is retail media. Amazon Ads, the retail media leader, is catching up to Meta (Facebook) and Google in the digital advertising triopoly. Retail media is taking on search and social advertising by using audience data and employing auction mechanisms similar to those used by their competitors. As the advertising channel expands, this is a powerful cash generator.

In the gap between customers and brands, the retail media ecosystem exists. The internet dimension is now occupied by a system of on- and offline merchants, marketplaces, ad tech, and agencies, when it was once primarily occupied by retailers.

The Big global pure players, local pure players, vertical marketplaces, and click-and-bricks make up the European marketplace scene. Amazon is still the world’s first online marketplace, as well as the world’s largest and most popular retail advertising platform but other marketplaces, more local or vertical ones, are growing and offering more and more services to brands who want to boost their visibility and sales on their platforms. 

This wide range of marketplaces is very specific to the European market, which is particularly fragmented. This diversity of marketplaces represents an opportunity for merchants to target their audience more efficiently and also to reduce their dependence on just one or two players. 

The leading players differ by country (Cdiscount in France, OTTO in Germany, OnBuy in the UK, Bol.com in the Netherlands…) but they all have one thing in common: they’re all retail media enabled.

Retail media has a high level of awareness due to the significant expansion of ecommerce and the focus on the commercial offering. It is, however, considered immature, having only recently emerged and only just begun to enter a growth phase. More retailers will create marketplaces, and pure players and ad tech operators will invest more in ad tech, boosting growth. This trend will be accelerated by the shift from untrackable trade marketing to optimizable retail media.

Omnichannel solutions are being offered by retail networks and forward-thinking marketplaces, with the goal of offering more comprehensive coverage of the user journey and differentiated positioning. Ad tech companies are pursuing a ‘platformisa­tion’ strategy, which entails linking retail media assets across countries to make the offering more accessible to brands. These moves are all evidence of a fast-paced environment with numerous moving elements that can be tough for companies to navigate.

Retail media is used by brands to increase sales, get consumer insights that they would not otherwise have, and establish top-of-mind awareness of their products. When entering the space, brands face various challenges. In terms of brand fit, product assortment, and pricing, they must position themselves in each market. Uncontrolled distribution and pricing practices might result in channel cannibalism or inconsistency, lowering profitability. Brands confront difficult tracking and measurement challenges when it comes to controlling and piloting retail media, especially when offline activities are included in the scope. This is one of the main reasons why retail media operations are progressively absorbing trade marketing.

Increase the visibility of your products and boost their performances on marketplaces & online retailers with Lengow:

-Access more than 200 general, vertical, global or local marketplaces depending on the products you sell and the audience you target.
You can pilot the Lengow platform on your own or leverage our Professional Services expert team.

-Optimise your retail media campaigns by:

• creating quality product listings with enhanced product data (titles, descriptions, images, etc.) that meet the specific entry requirements of each marketplace
• being competitive with the right assortment of products, at the right price and manage stock levels on each marketplace
• monitoring products in stock/out of stock, competitors’ prices and reviews on 30,000+ online retailers globally, with Netrivals, a Lengow company

From the perspective of an organization, brands develop organically to determine the best way to organize commerce and marketing around a retail media campaign. Even with a fluid organization in place, marketing to consumers via retail channels across the whole user journey, not just at the conversion moment, can be difficult.

The fragmentation of the scene, which includes multiple technologies, economic models, and formats, is the ultimate barrier to a broad retail media deployment.

We look at some of the most important trends in the business world and propose a future trajectory for its development in the next years.

What will it take for retail media to reach its full potential? How will brands be able to access the commercial offering? Will retail media seize the potential to capitalize on the social commerce trend and turn it into a brand-building opportunity? Finally, what does the future hold for merging retail media with other forms of programmatic advertising, and how likely is it to happen?

Discover it all in our full report STATE OF RETAIL MEDIA IN 2022 – EUROPE 

This research report is based on interviews of 11 experts representing 4 types of players in the retail media ecosystem.

Research carried out by Anders Hjorth, Founder of Innovell and Marie Crolard, Content Manager at Lengow.

Source: ‘State of Retail Media 2022: Europe’