Will Retail Media Drive eCommerce Brand Revenue?

retail eCommerce marketing

As brands see their ad spending across traditional digital media channels doesn’t go as far as it once did, eCommerce merchants are seizing on the opportunity to open up new revenue streams with the launch of retail media networks.

Take Wolt, the Helsinki-based, DoorDash-owned multinational on-demand delivery aggregator operating in 27 countries. In an interview with PYMNTS following the launch of the company’s advertising service for both merchants and brands, Catalina Salazar, global head of Wolt Ads, spoke to how the eCommerce media landscape is evolving.

“Every company that has this opportunity to connect their partners with their consumers will definitely be thinking of developing retail media solutions, and we hear from our partners as well that retail media is becoming increasingly important in the decision-making for investing their budget,” Salazar said.

She added that, where once “big media companies like Google and Meta” were commanding 70% to 80% of brands’ advertising budgets, these businesses are now reallocating those funds toward retail media. Indeed, brands continue to observe that it is getting harder to get the bang they once got for their advertising buck.

“[One] thing that really impresses me is the speed in which our partner brands have adapted to retail media,” Salazar said.

For on-demand delivery companies, these networks have the key benefit of enabling them to drive more revenue from their highly costly business models — a top-of-mind concern for players in the space right now. Indeed, these delivery services are doing everything from launching white-label offerings to expanding into new retail categories in an effort to more effectively monetize their driver networks and to open up new income streams.

Plus, increasingly, eCommerce players of all types, from retailers to third-party marketplaces to even banks (as of earlier this month) are making forays into the retail media space, monetizing their consumer data to supplement their existing revenue streams.

Consumers, for their part, are open to the kinds of targeted messaging that these ventures enable, according to the report “Personalized Offers Are Powerful — but Too Often Off-Base,” a PYMNTS Intelligence and AWS collaboration. The study, which drew on responses from more than 2,500 U.S. consumers, found that 71% of shoppers received personalized offers and are interested in them, and another 12% did not receive personalized offers, but are interested in them. Plus, 41% of millennials report they are highly likely to switch to merchants providing personalized offers, as do 34% of Gen Z consumers.

Yet it is not just about the kind of numerically derived personalization that these firms’ databases can offer. Salazar cautioned against the perils of fixating solely on performance metrics at the expense of branding. She emphasized the importance of striking a delicate balance between driving immediate conversions and cultivating enduring brand affinity.

“In the case of many brands that I’ve worked in the past, sometimes they focus too much only on performance media and measuring results and forget about building their brand,” Salazar said.

By integrating data-driven targeting with compelling brand narratives, Salazar envisioned a future where brands could forge deep emotional connections with consumers while simultaneously driving tangible business outcomes and long-term loyalty.

Looking ahead, Salazar spoke of the transformative potential of data collaboration in reshaping the retail media landscape. She envisions a future where brands derive synergistic insights by combining the information they have about their customers with retail media networks’ databases to craft more personalized and impactful marketing strategies, driving deeper engagement and fostering long-term customer loyalty.

“I think data collaboration is super exciting,” she said. “I’m super excited about the opportunities of exploring more [of this], being able to leverage the power that we have in understanding consumers with what brands also know about their customers, and collaborating in creating smarter, better strategies together.”