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You Can Take Retail Media to the Bank

12 Jun 2024

An active audience identifiable through robust first-party data are the most important qualifiers for launching a media network — retail or otherwise.

By Ethan Goodman, Mars United℠ Commerce 

“Retail media” is no longer just for retailers. Recent events in the financial services space have made this especially evident, with Chase Bank and PayPal each announcing the launch of a media network for advertisers.

This isn’t the first time a “non-retailer” has entered the space. Marriott International, in fact, introduced a “travel media network” back in 2022. But interest has been growing, driven by two key factors:

First is the impending deprecation of behavior-tracking digital “cookies,” which has many companies considering the potential for monetizing the rich, first-party customer data they possess. First-party data is, of course, what has made retail media networks so wildly popular in the advertising world.

The second factor is the success that retail media networks have had in monetizing their first-party data and building profitable media businesses. From the perspective of financial services and other potential players, the mindset is, “We have customer data just like Amazon, Walmart, and Target, so why can’t we build a profitable ad business, too?”

The short answer is, they can, because their core offering is basically the same. Chase and PayPal have first-party data about consumer behavior amassed through their interactions with customers, along with high-traffic web properties where these consumers can be engaged.

While there are countless other factors that determine success or failure, these are the two most critical elements of an effective media network. There’s no reason why companies like PayPal or Chase can’t repeat the success already enjoyed by many retailers if they establish well-operated networks that are guided by sound strategies and dedicated investments.

In fact, in terms of attractive features for advertisers, financial services firms may have one advantage over their retailer counterparts: cross-retailer data. Chase and PayPal have a wider purview into consumer behavior than Amazon, Walmart, and Target, because their data spans activity across any number of retailer transactions. That could prove to be a unique selling point for these networks — depending on whether their data can provide category-level or even product-specific insights. (Knowing that someone purchased $7 worth of toothpaste at Walmart is far more valuable than simply knowing that they spent $100 on various unidentified items.)

Increased competition from other industries could have another significant impact on the marketplace. As more players enter the “media network” space, competition will intensify. Until now, due to the value of first-party data, retail media networks have been able to charge a premium. But as more first-party data options become available to advertisers, those premiums could decline.

Ultimately, we expect more players in the financial services arena to follow the lead of Chase and PayPal. Like Amazon and Walmart in the retail channel, these first movers will prove that the market is viable and start to capture market share. Nearly every retailer with significant scale now offers media services; it wouldn’t be surprising to see the same level of proliferation occur within financial services.

One word of caution for any company looking to enter the fray. We’ve always advised retailers to avoid leaving the “retail” out of “retail media” because maintaining strong alignment with their core business — and their established relationship with shoppers — is critical to success. Companies in other industries need to keep the same thing in mind as they adopt the retail media model to commercialize their audiences: advertising should enhance the customer experience in relevant ways, not distract from its central purpose.

Ethan Goodman

About the Author
As EVP Digital Commerce, Ethan Goodman is tasked with managing growth and success for two of Mars United Commerce’s most vibrant and critical business centers. During his career, he has conducted groundbreaking work in the areas of digital shopper marketing, ecommerce, retail media and voice-enabled engagement. His talent for spotting the “next big thing” has made him a critical asset for the agency across roles that put him directly in charge of innovation and strategic investments, and his work building the ecommerce and media practices has made Mars United an industry leader in both areas.

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