Unlocking the Future of Retail Media: Google’s Strategic Shift to Off-Site Expansion
Understanding Shopper Journeys
"Shopper journeys are complex, and retail media networks (RMNs) need the scale to reach those shoppers wherever they may be," asserts Shawn McGahee, head of retail media at Google. This insightful declaration from the recent EMARKETER Summit on Commerce Media highlights the ever-evolving landscape of digital advertising.
The Power of Off-Site Inventory
In response to this complexity, RMNs are pivoting towards off-site inventory, enabling advertisers to effectively target consumers across the digital landscape. McGahee emphasizes the significance of this shift, stating, "We’re seeing off-site being a great channel to help drive improved incremental sales in retail media."
Why Google is Leading This Charge
Google’s dominant presence across platforms like Search, YouTube, Maps, and the open web allows it to leverage multiple touchpoints in the shopper’s journey. "There’s searching behavior in nearly every shopper’s path—scrolling, streaming, and shopping," explains McGahee.
How Google is Integrating Retail Ads
Google’s strategy revolves around embedding retail ads organically throughout its properties. Here are some examples:
- Off-site ads complement sponsored products on Google Search and Shopping.
- Targeted ads are also rolled out on Google Discover and YouTube Shorts.
- Connected TV (CTV) viewers can engage with retail media ads, thanks to new integrations with Google’s Display & Video 360.
"We’re leaning into what we know about customer behaviors," says McGahee, reflecting Google’s commitment to refining ad placement.
A Three-Pronged Focus for Retail Media
As Google gears up for further expansion in retail media, the company is honing in on three pivotal areas:
Performance
"There’s a growing demand for media that performs," highlights McGahee. Advertisers often face a disconnect between reported Return on Ad Spend (ROAS) and retail results, signaling a pressing need for improved performance metrics.Fragmentation
Many brands are engaging across six to eleven RMNs, compounded by various ad tech platforms. McGahee asserts, "We can’t achieve the next level of scale with that much fragmentation," emphasizing the need for integrations.- Measurement
The true value of RMNs lies in their measurement capabilities; however, complexities arise that challenge accurate tracking. "Measurement is the most challenging aspect for them," admits McGahee.
Catering to All Sizes of Retailers
While smaller retailers may not wield the scale of giants like Walmart or Amazon, significant opportunities remain for success. "You can’t just take the big guys’ playbook and copy it,” advises McGahee. Instead, he encourages smaller networks to capitalize on unique assets—such as in-store availability—and strive for incremental performance that can outshine competitors.
The Shift to Tailored Strategies
As the retail media landscape matures, McGahee foresees a shift from one-size-fits-all strategies to "unique cohorts," focusing on tailored approaches that resonate with diverse consumer segments.
Real-Time Adjustments: A Game Changer
Google is also pioneering real-time campaign adjustments. By utilizing its infrastructure, advertisers can assess campaign performance as it unfolds, allowing for immediate bid adjustments and strategy tweaks. "There is a big opportunity in real-time bidding and optimization," McGahee states. "We’re excited about activating in that space."
Bridging Online and Offline Experiences
For RMNs that operate with a physical presence, Google is dedicated to creating seamless online-offline integrations. Here’s how it works:
- Collaborating with retailers allows Google to leverage product feeds to identify in-store offerings.
- Local inventory ads can trigger placements on Google Maps, aiding in both foot traffic and in-store sales.
- To maximize this potential, clean product feeds and offline sales data for attribution are essential. As McGahee notes, "The need for that is only going to grow."
Check out the full session here.
Originally featured in the EMARKETER Daily newsletter. For more insights and trends in marketing, subscribe here.
