The emergence of search and social media were huge moments in the world of digital advertising, and now the next big wave of transformation is emerging: retail media.
It’s when ads are displayed on a retailer’s eCommerce site or app, either by the retailer or another brand within its network.
Retail media advertising is not a new concept. Amazon first pioneered retail media advertising in 2012 in the US when it launched Amazon Advertising, the world’s first bid-and-buy sponsored marketplace. Since then, many other major global players including Walmart, Target and closer to home players like Shopee and Lazada have followed suit. There are now over 216 retail media networks (RMNs) worldwide. From 2016, retail media’s growth had started to accelerate significantly, and the US market shot from $1bn to $30bn in just 5 years by 2021, an increase that took Social 11 years to achieve.
Then came an eCommerce boom, kickstarted by the global COVID-19 pandemic, which saw online shopping become the new normal and an explosion in the use of e-commerce and quick commerce delivery services, from goods to food and groceries.
In Asia, we have homegrown digital RMNs including Carousell, Alibaba, Flipkart, JD, foodpanda, Grab, Lazada, Tokopedia and Shopee.
In Southeast Asia alone, there are 460 million internet users, so the opportunities for brands to leverage retail media to access new consumers are vast. The eCommerce market in Southeast Asia is projected to reach 211 billion US$ by 2025. Asia is also the leading region in the world for smartphone and app usage, with 7 of the top 10 app usage nations being in the region. On top of the size of the market, changing customer behavior in Southeast Asia, with habits shifting from offline to online shopping on platforms like Lazada, Shopee, foodpanda and others, is also making retail media a more lucrative opportunity.
Dubbed the 3rd wave of digital advertising, retail media is the fastest growing media channel globally, with annual growth of 17.5% in 2024.
Retail media enables brands to target people already in the buying mood. In addition, retail networks can tell the brands a lot about the profiles, behaviours and preferences of the shoppers on their platforms. The key driver for the retail media boom is the wealth of valuable first-party data that retail networks can collect and offer to advertisers.
And in a world where 3rd party cookies can no longer give marketers the data fuel they need, this first party data is more valuable than ever. This is driving marketers to diversify their channel mix and look for new ways to reach audiences where they are.
Every marketer is looking to level-up their targeting. And the advanced targeting and real-time insights made possible with retail media empower brands to strategically engage consumers and maximise impact at every stage of their retail journey.
Advertisers can target consumers based on actual purchase data and insights, and crucially can do so at every stage of their marketing funnel. They are able to optimise for outcomes from an awareness level all the way to conversion.
“This can be particularly beneficial for retailers in Asia, where eCommerce is rapidly growing, and online advertising is becoming more popular,” Prayarana Aryan, head of eCommerce at Havas Media Singapore said. “Retail media platforms can help retailers forge partnerships with brands and advertisers, enabling them to offer more personalised and relevant ads to their customers.”
So powerful is retail media in fact, that 70% of advertisers are seeing an improvement in performance from retail media networks over other channels.
A survey of 2000 advertising decision makers across Southeast Asia and India revealed almost all or 99% of Asia-based marketers will increase their retail media spend in 2023. Around 87% of the respondents surveyed say they intend to include retail media as part of their media plans within the next 12 months.
Brands available within the retail platforms themselves, or endemic brands as they are known, are enjoying more possibilities than ever. As the range of digital retail media formats has grown, so has advertisers’ ability to reach retailer audiences and the opportunity to embed commerce functionality across the entire shopper journey – resulting in a seamless experience from discovery to purchase.
There is a common misconception that brands with products and services not available through the retail channels, known as non-endemic brands, cannot benefit from the power of retail media. But the opposite is true. These brands can leverage these capabilities to access diverse audiences and broaden their market reach. In fact, 63% of retailers have non-seller brands advertising on their media networks.
By tapping into the extensive user base of retail media platforms, non-endemic brands can create highly relevant and personalised campaigns that resonate with potential customers, even if they are not actively looking for the advertised products or services.
This is reflected in the results of an industry survey, with 44% of respondents saying they will advertise on a retail media network even if they do not have any products listed on that marketplace.
The survey results also show that brands and agencies already have retail media advertising as part of their current media mix, with 99% of respondents planning to increase their retail media spend over the next 12 months.
The time is now. Marketers not already building retail media into their strategies are missing out.
foodpanda is Asia’s leading food and grocery delivery platform (outside of China) with a presence across 11 markets and an extensive user base with over 125 million app downloads. The platform serves 33 million monthly active users in more than 400 cities, making it the most utilised food & grocery delivery platform in Asia (outside of China).
panda ads offers tailored solutions that leverage foodpanda’s extensive user base and first-party data, empowering brands to craft effective campaigns that deliver impact and results at every stage of the foodpanda customer journey.
foodpanda audiences cover a range of different demographics, but they all have something in common… They are hungry to buy. Whether it’s looking for an evening meal, or grabbing last-minute groceries.
Tap into our audience of digital natives with high purchase intent who love to shop and love convenience. Many return to the app frequently and place multiple orders per month. They stick around too, with high retention rate.
panda ads’ solutions help brands target foodpanda users across verticals. The solutions range from push notifications and search and order tracking to product sampling and payment, allowing panda ads to engage with digital-native customers who want greater choice and accessibility, convenience, and a personalised experience.
