Retail media advertising is undergoing a seismic shift, and it's no longer just about promoting products directly sold on a retailer's platform. For years, the model has been straightforward: if you're selling products on Amazon, you advertise on Amazon, creating a clear path from ad to sale. This has been the cornerstone of retail media platforms.
But now, we're witnessing a major pivot towards what's called non-endemic retail media advertising, and it's reshaping the digital marketing landscape.
What's Non-Endemic Retail Media Advertising, and Why Should You Care?
Non-endemic retail media advertising is all about promoting products or services that aren't actually sold on the retailer's site. Imagine browsing Amazon and suddenly encountering an ad for a luxury vacation package, insurance, or a high-end car. These aren't items you'd typically buy on Amazon, and that's precisely the point. Brands that don't sell directly on a platform are now competing for visibility in these retail spaces.
This shift is driven by a simple realization: platforms like Amazon have understood that their advertising potential extends far beyond just promoting the products they sell. By opening up their ad inventory to non-endemic brands, they're tapping into a much larger pool of advertising dollars and transforming their platforms into comprehensive advertising ecosystems.
For brands, it's an opportunity to reach a highly targeted and engaged audience, even if they're not selling their products on that specific platform.
The Players and the Potential
Amazon may be leading the charge, but other retail giants like Walmart and Target are quickly catching up. According to eMarketer, offsite retail media advertising—ads that run outside of the retailer's own ecosystem—will make up a whopping 20% of all retail media spend by 2025. This growth is primarily fueled by non-endemic opportunities, as more brands recognize the potential of leveraging retail media networks (RMNs) for exposure, even if they're not directly tied to selling products on those platforms.
Why Are Brands Jumping In?
The appeal for non-endemic advertisers is multifaceted:
Targeted Reach: Retail media platforms possess a treasure trove of consumer data, enabling pinpoint targeting. Even if a brand isn't selling products on Amazon, they can still reach the right customers based on shopping habits, search history, and more.
High-Intent Audiences: Retail sites are destinations for consumers already in a buying mindset. Non-endemic brands can tap into that intent, catching consumers when they're primed for action—even if the purchase happens elsewhere.
Diversified Revenue Streams for Retailers: For platforms, non-endemic advertising is a goldmine. It's an entirely new revenue stream that doesn't rely on sales transactions, but instead on the massive audience they've cultivated.
Metrics Brands Should Track
As brands dive into non-endemic retail media, tracking the right metrics is key to understanding performance. Click-Through Rate (CTR) remains a primary indicator of engagement, but it’s only the beginning. Leveraging Amazon’s tracking tools, like tags or pixels, can help brands monitor sign-ups, conversions, and even off-platform sales. These insights provide a more holistic view of how well non-endemic ads drive real business outcomes beyond just clicks.
The Growth Potential
The future of retail media is bright, with non-endemic advertising poised to play a starring role. We predict that retail media spending could skyrocket to $230 billion globally by 2027, with non-endemic ads being a major driver of this growth. As platforms become more sophisticated in their targeting and measurement capabilities, it's easy to see why more brands are eagerly jumping on this trend.
Looking Ahead
The shift towards non-endemic retail media advertising isn't just a passing fad—it's a fundamental reimagining of digital marketing strategies. Retail platforms are evolving from mere sales channels into full-fledged advertising powerhouses. As this space continues to expand, it's becoming increasingly crucial for brands—whether endemic advertising or non-endemic—to think strategically about how they can leverage these platforms for growth.
Amazon, once focused solely on manufacturers advertising products sold on its platform, is now leading the charge in non-endemic advertising. They've recognized that there's more money to be made by broadening their Amazon ads horizons beyond their own product ecosystem. This shift is creating a ripple effect across the industry, with other platforms following suit and opening up their advertising spaces to non-endemic brands.
Non-endemic retail media advertising isn't just about being in the right place at the right time—it's about capitalizing on where consumer attention already resides and positioning your brand right at the center of it.
As we look to the future, it's clear that non-endemic retail media advertising will play a pivotal role in shaping the digital marketing strategies of tomorrow. With its promise of targeted reach, engaged audiences, and new revenue streams, it's a trend that both brands and platforms can't afford to ignore.
The question isn't whether to get involved, but how quickly you can adapt and make the most of this game-changing opportunity.
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