TERRY KANE: IS THE DATA REVOLUTION ABOUT TO CHANGE ADVERTISING AS WE KNOW IT?
Terry Kane, Managing Director Middle East & Africa, The Trade Desk on how retail data presents tremendous opportunities for both in-store and online advertising.
Retail sales in the GCC region are projected to reach USD 386.9 billion by 2028 with the sector growing at a Compound Annual Growth Rate (CAGR) of 4.6 per cent between 2024 and 2028. The UAE and Saudi Arabia are expected to lead this growth, with CAGRs of 5.4 percent and 5.1 percent, respectively.
Saudi Arabia soared to third place globally in the 2023 Kearney Global Retail Development Index(™), climbing nine spots and solidifying the Middle East and Africa (MEA) as retail’s next global “hot spot.” The report points to youth-driven urbanization, a projected doubling of disposable income by 2040, and supportive policies as the major forces fueling this retail boom across MEA countries. Amidst this growth, retailers in the region need to be ready to adapt to the latest retail trends and opportunities to fully reap this potential of the sector.
Retail data presents tremendous opportunities for both in-store and online advertising. Not only does it help marketers measure the impact of campaign spend on actual customer outcomes, retail data allows for more precise targeting, improved customer acquisition and a deeper insight into purchase behavior.
The term ‘retail media’ triggers various definitions in the industry as some of its core aspects have yet to be clearly defined. At The Trade Desk, we think of ‘shopper marketing’ as an umbrella term covering the broader opportunity in retail, from physical in-store ads to product suggestions on online stores.
Sitting underneath this retail media umbrella is offsite retail data: where data is decoupled from the retailer’s own websites and apps and made available to power and optimize a campaign across digital channels on the open internet, including streaming TV. This is particularly exciting for advertisers as it moves retail media from just being a “direct sales” media channel to a broader brand building opportunity.
Offsite retail data is a promising new revenue stream that could change retail as we know it. It is a growth engine for the retail media category overall, which is the fastest growing form of ad spend with global spend expected to reach 140 billion USD this year and comprising over 20% of total digital ad spend.
While on-site advertising has traditionally worked well, it is limited to insights from the retailer’s website. We see a strong appetite from brands for more advanced measurement capabilities to understand the impact of their paid media activity across both online and in-store sales.
With consumers living and working across multiple channels, retail data plays an invaluable role in making sense of consumer behavior and learning who to target. Many of the world’s biggest retailers including Walmart, Schwarz and Tesco are leading the way in terms of retail data.
Retail media has the objectivity and transparency that the walled gardens lack - giving it the potential to open the walled gardens for good as more and more brands recognise retail media as a strategic enabler of the open internet. It means closing the loop between digital advertising and sales - on and offline - helping brands to measure the impact of each tactic.
Closer collaboration between retailers and advertisers means they can anticipate future trends earlier. Retail data provides brands with insights into the types of products customers are getting excited about, and when they’re choosing to buy them. Thanks to this insight, retailers can help advertisers prepare for upcoming trends and stay ahead of the curve.
Both retailers and advertisers can reap huge rewards from a strategic collaboration. By tapping into the rich insights of retailers, advertisers can measure campaign performance in real-time, and after completion evaluate and adjust to make campaigns even more effective going forward. This data can help both parties to close the loop between advertising and sales both on and offline, enabling retailers and advertisers to target their consumers as accurately as possible.
Retail data is the missing piece of the omnichannel puzzle and the industry has merely scratched the surface. In a rapidly growing market like MENA, predicted to become retail’s next big global “hot spot”, retail data will be an essential tool in any digital marketer’s toolbox, enabling marketers to precisely reach their audience throughout the buyer journey.
