Retail Data Monetization for your business

Monetization is top of mind for retailers, grocery stores, pet stores and, frankly, any business at the moment. With budgets under greater scrutiny and pressure, monetization offers an ideal partnership opportunity in which brands get ROI and other critical insights through reaching retailer’s in-market customers, while retailers get a new revenue stream.

There's a $42 billion co-op advertising opportunity. Following conversations with multiple businesses across industries, we want to highlight an overlooked retailer monetization opportunity: Open-web advertising—i.e., offsite advertising—is a larger opportunity than onsite advertising.

What does advertising on the open web look like?

In this context, we define “open web” as the digital space including websites that are not retailers’ owned websites nor walled garden (Facebook, Amazon, etc.) platforms. Brands are able to use the open web to reach a much higher number of in-market customers than is available on retailers’ owned websites.

Let’s take a dog food brand as an example. The brand invests marketing dollars to promote their products on a pet store’s owned website, and they use co-branded creative promoting their product with a call to action to buy at that pet store. The brand then also messages customers of this pet store when they are browsing news, sport, entertainment and other sites on the open web. This allows for a much broader reach of in-market consumers and a far more exciting return on ad spend (ROAS) than just performing onsite monetization alone.

Many retailers start with onsite messaging on their owned assets, such as their website, which is understandable. Site and app visitors volunteer their intent to purchase, and retailers have existing e-commerce teams to implement monetization such as dedicated ad space on the homepage or sponsored search results. Conversely, extending their digital retail media strategy to the open web is very challenging. On of these challenges relates to effective retail data monetization.There’s a need for the best data onboarder to maximize reach, optimizing to know who is likely to buy the brand right now, reporting to prove SKU-level ROI across channels and, finally, conducting potentially significant hiring to execute this complex marketing technology operation.

But, if retailers overcome these big challenges, offsite advertising is one of the largest monetization opportunities they have. Allow us to share some by-the-numbers industry examples before getting to the how.

Examples of the open web’s effectiveness

Convenience Store: Open-web advertising opportunity 43x larger than onsite

One of the largest convenience stores has a robust e-commerce presence complementing offline sales at thousands of stores. During Q2 of this year, the convenience store wanted to expand from onsite to open-web advertising when they discovered just how much larger the audience is:

  • Onsite: 14.6 million consumers visiting site (8.5 million visitors only seen visiting site)
  • Open web: 68.6 million customers reachable on the open web (of which 62.5 million only reachable on open web)

What’s more, they discovered that the open web offered significantly more opportunities to message and monetize a customer:

  • Onsite: Consumers, on average visit website 7 days during a quarter
  • Open web: Customers on average are reachable 65 days during a quarter on the open web

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Large Department Store: Open-web advertising opportunity 21x larger than onsite

One of America’s largest department stores has multi-channel sales with a robust e-commerce website and app, along with hundreds of in-store locations. The department store sought to expand to open-web advertising, also, when it saw how much larger the opportunity was:

  • Audience:
    • Onsite: 30.5 million consumers visiting site (of which 18.3 million only visiting site)
    • Open web: 80 million customers messagable on open web (of which 67.8 million only reachable on open web)
  • Opportunities for customer messaging:
    • Onsite: Consumers on average visit site 8 days during a quarter
    • Open web: Customers on average reachable 64 days during a quarter on the open web

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These examples show just how powerful the open-web advertising opportunity is. But as discussed before, actually moving forward with the process can be a challenge. In order to see a worthwhile ROAS from the expansion to open web, there are three crucial needs.

3 steps to open-web advertising

1. An optimized identity solution

Especially in an era of ever-increasing identifier deprecation, the first consideration to maximize your reach to customers for open-web advertising opportunities is identity. Oftentimes, data onboarders’ reach is two to three times lower than what it could be.

What’s more, there’s the issue of potential cookie loss through fragmented execution with a data onboarder, a data management platform (DMP) and a demand-side platform (DSP). This limits monetization efforts, as you’re only able to reach a fraction of the total in-market audience. As well, third-party data providers are often segmented, modeled and stale.

Without a robust and resilient identity strategy, an open-web advertising opportunity is dead on arrival because of the need to reach and optimize limited in-market consumers without wasting media budgets.

2. Time and resources

In today’s environment, everyone is strapped for time and resources, but these are essential to scale open web co-op. Managing the brand relationship is the most critical, but then there are the tactical aspects as well that are essential to the success: sourcing budgets, creative execution for all rich media formats, identifying SKUs for each campaign, creating optimized audiences and important campaign measurement.

We have seen retailers unlock open-web opportunities, driving +$2M in top-line revenue without adding resources because they partnered with a fully managed service to handle all the implementation while the retailer focused on brand relationships.

3. SKU-level measurement and unique insights

Clicks and impressions are no longer considered campaign success metrics. Brands are now demanding better ROI, and it has become table stakes to provide unique in-flight SKU level performance (online and offline).

Brands cannot get enough insights on their customers with their retail partners. The co-op campaigns have to perform, but you also have to provide insights, including data and analytics, into those that are purchasing, such as demographics, along with timing for the last time they purchased the SKU or brand. These unique insights into customers keep brands re-investing in co-op programs.

We have seen a retailer secure +$1M brand budgets due to the success of their previous campaigns, driving 23x:1 brand ROAS.

Seize the opportunity

The numbers show that open-web advertising is a strong, under-leveraged way to maximize your overall monetization strategy. But without a reliable and robust identity solution, time and resources, the right retail data monetization approach, measurement at the SKU level and continuous optimization, charting the open web waters will not reap the maximum possible benefits.

Partnering with an expert in open-web advertising can help you achieve a strong return on ad spend to fuel business growth. And in a time when every budgeted dollar is under scrutiny, it may be time to branch out.