By Sue Azari, Industry Lead E-commerce at AppsFlyer
When people think of the United Arab Emirates, they think of many things — glistening skylines, seven-star hotels, and theme parks. But it is also known for being a shopper’s paradise. UAE retail is a hundred-billion-dollar industry. However, with the advent of regulations around privacy, it has become increasingly difficult to capture consumers directly. Product sellers and their marketers are looking to third-party platforms to address the problem.
Retail media networks — the advertising ecosystem provided by retailers and retail facilities, through their apps, websites, on-premises billboards, and more — have been experiencing some changes of late. These changes are bringing opportunities, but only to those with adequately precise measurement models that enable laser-targeted campaigns and allow advertisers to boost engagement rates and hence, sales.
It is these benefits that are driving growth in revenues across the regional retail media space. It makes sense. A video games vendor can join forces with an electronics retailer like Jacky’s or Emax, for example, to tap into console sales data. Such collaborations can run through data clean room platforms even as privacy limitations close off traditional routes to customer acquisition. However commerce media networks normally use in-house analytics for campaign evaluation, and this limits the amount of quality data available to the advertiser. Therefore, retail media networks that can offer strong investment-returns metrics like ROI and ROAS (return on ad spend) will prosper. This makes a case for networks investing in the expansion of data breadth, depth, and actionability. In the new landscape, a strong demonstration of value will be a prerequisite for survival.
Making connections
Performance measurement has never been easy. Accurate, granular data is a must, as are the right KPIs. And platform providers must deliver omnichannel monitoring through metrics like ROAS, the incremental return on ad spend (iROAS), and customer lifetime value (LTV), as well as standards such as CPM, click-through rates, impressions, reach, frequency, attributed sales, and sales lift. ROAS shows the correlation (or lack thereof) between media-network spending and revenue generation. Incremental sales and iROAS measure the additional value brought by network-based campaigns, such as new customers, increasing basket size, or purchase frequency. All this is essential for end customers to gain an edge in a competitive retail environment.
For commerce media networks looking to attain “closed-loop” attribution — the incontrovertible link between ad purchases and customer purchases — a data collaboration partner is critical. Knowing which content, customers, and circumstances are driving incremental business means one does not have to rely on guesswork, speculation, or luck to drive sales. A rich, intuitive presentation of campaign data is just what the doctor ordered for the region’s ambitious sellers. But this alone is not enough. Dashboards must point the way to action. One of the biggest advantages of commerce and retail media is the mountain of data available. Volumes are enough to enable actionable insights that come from a deeper understanding of campaigns and the customers they target. Marketing becomes more strategic, more intelligent, and connects with more customers in more meaningful ways.
The way this is achieved in the modern media industry will hardly surprise you. Artificial Intelligence (AI) allows us to take deeper dives into campaign data than we have previously done. Campaigns must be constantly adjusted to keep pace with changing consumer sentiment. Given the amount of data involved, it is impractical to assign such a task to a human. AI is not only adept at deep analysis of large data stores but tech such as generative AI is capable of human-like understanding of queries and instructions from marketing professionals. To ensure privacy and compliance with all regulations, the AI operates within a secure data collaboration platform. This setup allows us to harness the power of AI to generate insights from the data while maintaining stringent privacy controls. We can now simply ask the AI-powered assistant for the number of whales that emanated from a specific campaign to understand the value generation and what drove it. By seamlessly sifting through multiple data sources, the AI provides insights without exposing any restricted or user-level data, ensuring all information remains protected.
Change for the better
What we are pursuing here is optimal audience segmentation, which gives us optimal campaign impact. We are achieving it by using a data platform that allows ongoing rapid campaign assessment against KPIs and business goals and therefore rapid insights that can be used for audience modeling. What the data collaboration partner brings is the capability to combine data at scale with advanced measurement and attribution functions. Because of the effectiveness of these technologies, advertisers lower their total cost of ownership because they no longer need to operate and maintain multiple systems. Imagine running more effective campaigns that are more granularly monitored and therefore can be improved upon more easily. Then imagine that this all takes place for less cost than legacy approaches.
The working day of the marketing professional looks a lot different with a data collaboration partner on board. In days gone by, they would have been stuck in perpetual brainstorming sessions over how, in the age of privacy, to extract enough quality data to run meaningful campaigns. Under the new paradigm, they consult a dashboard or pose a natural-language question into the platform itself. Insights are immediate and effortless. Then they run a campaign and find it was more effective than ever before. They look at the metrics and find their way to the root cause of success. They dial up what worked and dial down what did not, and shortly, they are in a cycle of continuous improvement.
Commerce media networks have become key to transformation within the business of advertisers. We can see the incredible gifts bestowed on all stakeholders by non-endemic advertising. When these gifts are properly leveraged by strategic thinkers who combine them with advanced analytics, they not only capture the right data; but they are able to transform it into shrewd actions.
Secret sauce
Previous generations of marketers could only dream of adapting to consumer responses and market trends with this kind of precision and impact. The right data collaboration partner and the ideal commerce media network will fuse to create a machine of innovation that can ride any market conditions to success. The approaches described are the secret sauce of market leadership.
In image above: By Sue Azari, Industry Lead E-commerce at AppsFlyer
