The Role of AI/ML in Retail Media Advertising
7 min read
For Retail Media Networks (RMNs), the key to staying ahead lies in embracing the transformative force of AI-powered automation technology. It’s not just a strategy; it’s a game-changer for streamlining processes from ad serving to e-commerce delivery.
The e-commerce sector, like many other parts of the digital economy, has been evolving exponentially in recent months due to the advancements in generative artificial intelligence, machine learning algorithms, and most importantly in shifts in buyer behaviors.
To make sure retailers and digital marketplaces capture a bigger piece in this growing market and are able to meet ever-evolving customer needs, it is important to ensure that e-commerce companies incorporate the latest AI innovation into their operations.
Streamlining The Ad Process with AI
For Retail Media Networks (RMNs), the key to staying ahead lies in embracing the transformative force of AI-powered automation technology. It’s not just a strategy; it’s a game-changer for streamlining processes from ad serving to e-commerce delivery. Picture this: Many retail brands are already riding the technology wave, leveraging sophisticated platforms for programmatic and native advertising. This involves the strategic use of algorithms and real-time bidding to snag ad inventory across a multitude of channels. It’s a smart move, but there’s more to uncover. RMNs aiming to elevate their game started to take the reins of automation technology and smooth out the ad buying process for their clients.
It’s not just about the purchase and placement of ads here; it’s about revolutionizing a spectrum of all ad activities. Imagine automated creation of multiple ad formats, precise audience segmentation based on first-party data, optimization in real-time, and advanced reporting — all orchestrated by the power of technology. This isn’t just about simplifying workflows; it’s about reducing manual efforts and supercharging operational efficiency, providing tangible results for both retailers and partnering brands.
According to Forbes, AI helps in driving online sales through personalized product recommendations, targeted marketing, and better content generation. And, now retailers are looking at how to bring some of those same AI tools into the physical store experience.
Recognizing the impactful role of AI in driving growth, many retailers are increasing their investments in this technology. NVIDIA’s inaugural State of AI in Retail and CPG survey reveals that 64% of retailers plan to expand their AI infrastructure investments in the next 18 months. The survey also highlights that 69% of retailers attribute AI to an increase in their annual revenue, while 72% experienced a reduction in operating costs, thanks to the implementation of AI.
2024 is witnessing the rise of intuitive chat-bots, making consumer interactions more personalized. It’s becoming possible now to have a shopping assistant that not only understands your preferences but remembers your child’s dietary restrictions and school policies. This level of personalization based on customer data is today’s reality, offering shoppers a more nuanced and tailored shopping experience.
Walmarts AI Shopping Assistant
Walmart, one of the retail giants in the United States, Canada, and Latin America, is at the forefront of AI adoption. Utilizing augmented reality and generative AI, Walmart Connect aims to take the shopping experience to a next level. With AI-powered tools for product search and replenishment, including a generative AI search feature, Walmart is making it easier for customers to find products based on use cases rather than searching certain product or brand names. You might request Walmart to provide search results for items perfect for a “movie night party,” eliminating the need to individually search for popcorn, candy, soda, comfy blankets, etc. This AI-based shopping enhancement enables them to ask questions and receive tailored product suggestions.
Brands Perspective on AI
Majority of brands recognize the power of AI in Retail Media, as it allows for precise targeting and measurement of advertising campaigns, making retailer data smarter and more actionable. For brands investing in Retail Media, AI will become highly important in their digital advertising efforts, improving site experiences and enabling them to engage and convert shoppers with sponsored ad formats at the point of purchase.
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GoWits AI-Powered Solutions
GoWit’s AI ensures efficient campaigns with minimal human effort. Autonomous campaigns, powered by AI, offer automatic targeting, bidding, and real-time optimization, leveling the playing field for advertisers with limited resources.
GoWit has been paving the way with AI-powered solutions for Retail Media for some time now. Unlocking the power of AI, we empower brands and advertisers to efficiently manage their campaigns with minimal manual effort, all while achieving key objectives like ROI, reach, and revenue. How does it work? Through advanced targeting, smart bidding strategies, real-time optimization, forecasting & insights, and helpful AI-based recommendations.
Identifying Target Audiences & ML
The AI system in our RMA platform assists brands in identifying the right target audience, allowing them to spend less on advertising while reaching the right segment audience at scale. GoWit’s AI-based solutions provide relevant and targeted ads efficiently. We use first-party and ad-performance data to target consumers and access available ad placements while offering personalized targeting capabilities through ML.
Machine learning algorithms help brands decide the right budget range for each ad, optimizing costs and improving conversion rates for the advertisers. With ML, brands allocate the appropriate budget for each target audience group. Carefully calculated ad budget bids across multiple platforms allow advertisers to prioritize clicks, shares, CPA, CPC, CPM, enhancing conversion rates and ensuring value by optimizing the bidding process for maximum profit.
Additionally, ML aids in targeting/ retargeting audiences based on their buying intent levels. This way, brands can then adjust and create ad creatives tailored to different stages in the customer journey.
Leveraging AI and ML enables brands, using the retail media platform, to swiftly adapt their campaigns to evolving market conditions. Integrating these technologies into digital marketing strategies not only provides brands with a competitive edge but also keeps them at the forefront in the growing digital retail landscape.
While GoWit allows advertisers to quickly customize and generate banner ads, the focus is on simplifying the ad creation process and optimizing for omnichannel advertising. RMA platform has been evolving to deliver a true omnichannel experience for both retailers and advertisers. This involves integrating brand experiences across various channels and using impactful formats like Sponsored Product Ads to target buyers at every stage of the purchasing journey. The goal is to align strategies with client business objectives and create a unified ecosystem.
Real-Time Data Insights
The surge in data privacy regulations presented a unique opportunity for Retail Media Networks to enable brands in actively targeting user profiles through measurable behavioral signals. Our audience-centric approach efficiently delivers relevant and targeted ads across various product categories in the RMA platform. One of the key strengths lies in real-time tracking and attribution of omnichannel campaigns, providing a transparent window into user profiles. This visibility creates a foundation for crafting a highly personalized brand experience journey.
With the integration of AI, these real-time data insights become even more potent, enabling the consolidation of information and offering a comprehensive view of crucial metrics such as ad impressions and sales achieved during a campaign.
The great part is that real-time measurement capabilities extend beyond mere visibility, incorporating predictive analytics for customer behavior. AI algorithms can now anticipate and proactively address evolving preferences, resonating with the specific preferences. This refinement ensures that ads remain highly relevant, resonating with the specific interests and needs of different customer groups.
Furthermore, algorithms continuously analyze campaign performance data, dynamically adjusting targeting parameters, bidding strategies, and ad creatives for maximum impact. This adaptive approach ensures that brands remain responsive to changing market dynamics and consumer behaviors. AI also facilitates the real-time synchronization of data acquired by various channels, ensuring a unified and consistent customer experience. This seamless integration is essential for maintaining brand coherence across online and offline touchpoints.
In conclusion, AI is undeniably playing a vital role in elevating Retail Media. From optimizing revenue to improving ROI, AI is transforming how advertisers and brands approach the evolving market. As the competition intensifies, RMNs embracing AI technology will stand out as media businesses with unparalleled retail trade knowledge, proving their worth and capitalizing on a significant competitive advantage. The future of Retail Media advertising is here, and AI is at the forefront of this exciting revolution.
Masters, Kiri. “5 Retail Media & Marketplace Predictions for 2024.” Forbes, www.forbes.com/sites/kirimasters/2023/12/21/5-retail-media-marketplace-predictions-for-2024/?sh=56f612af5a06. Accessed 29 Jan. 2024.
Pandit, Jayant. “Winning the Digital Shelf on Retail Media Networks with AI.” Consumer Goods Technology, consumergoods.com/winning-digital-shelf-retail-media-networks-ai. Accessed 29 Jan. 2024.
Pearse, Justin. “This Is How Retail Media Networks Should Use AI.” New Digital Age, 13 June 2023, newdigitalage.co/retail/this-is-how-retail-media-networks-should-use-ai/. Accessed 29 Jan. 2024.
Weiskittel, Michelle . “AI Has the Potential to Streamline and Strengthen Retail Media.” Www.adweek.com, www.adweek.com/partner-articles/ai-has-the-potential-to-streamline-and-strengthen-retail-media/. Accessed 29 Jan. 2024.