Global retail media adspend to reach $121.9bn in 2023 – Warc
To help brand owners focus, survive and thrive in the digital commerce space in 2023 and beyond, Warc has released, as a guide, the Future of Digital Commerce Toolkit. Warc said in 2023 and beyond, e-commerce will not just be a section of the retail picture, but a defining element of its composition.
According to Gregory Grudzinski, head of content, Warc Digital Commerce, in the past few years, the retail world has irrevocably transformed with e-commerce shifting the way consumers shop and becoming essential to the retail ecosystem.
“Retail media is now the fourth-largest advertising medium, per Warc survey data, and will see a 10.1% increase bringing its adspend to $121.9bn globally in 2023. Heading into next year, we’ll see retail media networks becoming an essential part of marketing strategies and heightened experimentation in social commerce,” Grudzinski said.
The report explored the intersection of marketing and commerce by examining the future of digital commerce as it relates to brand marketers, their agencies and their retail partners. It deep-dived into three key areas: Retail Media, Organisational Readiness, and Social Commerce.
According to Warc survey data, retail Media is now the fourth-largest advertising media. Adspend has more than doubled during 2019-2022, overtaking audio, OOH and cinema, publishing, and OTT/streaming. It added that if the retail media industry follows its current path, it will become more valuable to advertisers than linear TV by 2025.
“Retail media networks are growing in both number and importance and will be playing an outsized role in the shaping of digital commerce. Growth of retail media is positioned to do for the 2020s what search-powered digital advertising growth did for the 2000s and social media did for the 2010s.
“2023 will see a step change in the competition in retail media. Brands will need to go beyond understanding the platforms, to mastering how they can use them to connect with consumers,” the data revealed.
Ryan Monigan, VP of insights and strategy, WhyteSpyder, said: “Winning in digital commerce will mean gaining a better understanding of how your shopper navigates the site. You’ll need to move consumers from their actual path to the desired path, and calculate what level of investment is needed to make that happen.
“Brand owners are breaking down silos and evolving legacy staffing models to reflect the expertise, experience and flexibility needed to win in the dynamic, ultra-competitive digital commerce space.
“More brands are shifting to a more “decentralized” approach to their organisational structure by incorporating e-commerce across their organisation, rather than as a separate, siloed section of their business.”
According to data from SJC Marketing, driven by high rates of mobile penetration and demographics with an affinity for social media, social commerce is expected to reach $660bn globally by 2025, up from $295bn in 2021.
According to a report from McKinsey, in the US, social commerce is expected to grow to make up more than 5% of e-commerce sales at nearly $80bn by 2025. While in Southeast Asia, where social media is the primary channel for new product discovery, consideration, set building and product research, social commerce accounts for nearly half of e-commerce sales.
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