Brands embracing a full-funnel approach in e-commerce: Amazon Ads’ Ajay Sharma

New Delhi: In the era of Retail Media 2.0, the focus has shifted from a narrow emphasis on search-driven e-commerce to a more holistic, full-funnel approach that leverages the wealth of first-party shopping and streaming signals to power impactful advertising solutions.

“Retail media has grown rapidly, reaching $30 billion in just five years, compared to 14 years for traditional media and 11 years for social media. It's evolving into "Retail Media 2.0," which means it's not just about selling products anymore. Retail media now covers the entire marketing process, including creating awareness, engaging customers, and driving sales, said Moneka Khurana, Country Head & BOD, MMA Global India, while starting the ‘Retail Media 2.0: Opportunities and Strategies’ session at the 2024 Data Unplugged Delhi edition of the Mobile Marketers Association.

“This makes it a powerful tool for marketers and media experts, offering much more than just a platform for commerce. Its comprehensive approach to marketing means it can't be ignored as a key strategy in the industry,” she added. 

Adding to Khurrana’s words, Ajay Sharma, Head-Ad Sales, Large Customer Business Amazon Ads India, said, “61% of customers research products through various media channels. Consumer purchase behaviour, whether online or offline, is omnichannel and non-linear. Mapping customer journeys across channels is challenging, as each journey varies by category and research period. Even on platforms like Amazon, the buying process is not straightforward; it involves complex, convoluted paths. 

I often ask my team and advertisers to imagine a day without the buy button on Amazon. Even without it, Amazon remains valuable due to its vast selection, customer reviews, and brand information. The shift is towards a comprehensive approach, where brands and marketers focus on long-term strategies across the entire funnel rather than just immediate sales.”

Moving on, what does a marketer need the most? The short answer is real-time insights so that they can track the consumer’s journey in real time. How does that help a marketer even more in today's times when they are leveraging retail media as a channel? 

Answering the query, Sharma said, “We work with brands to help them discover insights using a platform called Amazon Pi. This tool offers multiple reports that allow brands to understand their customers and how advertising impacts them. For example, in the face care category, customers are now searching for specific products like dragon blood face cream and chrysanthemum serum, rather than just generic whitening creams. By providing real-time insights into customer search preferences, we enable brands to customise their offerings and develop new products.

A powerful example of this is a pocket printer, initially launched in the US and then in India. The brand assumed it would resonate with the youth, as it did in the US. We ran a comprehensive campaign involving search, display, and video ads to identify the most engaged audience. Surprisingly, new moms showed the highest engagement, as the pocket printer allowed them to print photos from their mobile phones onto sticky paper, which they could put on their tables and fridges. We shared this insight with the brand, which then adjusted its communication strategy. The revised campaign was more successful, showcasing the value of our insights and the importance of understanding evolving customer preferences.”

During the session, Khurana mentioned a report by the Mobile Marketers Association indicating that retail media spending currently accounts for over 11% of digital media plans. Additionally, all respondents in the report expressed a desire to increase these expenditures by at least 70% over their current allocations. This significant surge in spending is expected to take place by 2025.

Having said that, Khurana asked Sharma how he perceives the role of retail media 2.0 is further going to evolve for marketers.

Sharing his thoughts on the subject, Sharma said, “I know brands that my team and I service, where our share of spends is actually north of 35 to 40%. These brands have fully embraced the full funnel story. Previously, people thought of the platform as solely focused on ROI, and I used to joke with my team that ROI was tattooed on our heads because marketers always asked about it. 

However, this is changing, and it will drive significant change this year. Conversations that used to focus on bottom-funnel search efficiencies are now moving to the middle funnel, discussing consideration gains for advertisers. More than 50 to 60% of our customers are now using video. We have acquired certain assets of MX Player, launched miniTV, and always had this capability in DSP (demand side platform). Customers who use us across the funnel will drive this behaviour in 2025 and beyond.”

Khurana mentioned additional data from the report, highlighting the effectiveness of retail media. Respondents found retail media to be 61% effective in generating awareness, 66% effective in driving engagement, and 69% effective in achieving conversions. This underscores the significant impact of retail media across various stages of the marketing funnel.

Sharing some tips for marketers who looking forward to adding retail media to their marketing funnel, Sharma said, “First, it's crucial to understand the insights provided by platforms. These platforms have a deep understanding of consumer behaviours, such as search and partner purchase behaviours. Businesses need to be inquisitive and ask questions that can shape their overall strategy, not just their marketing spend. Second, focus on analytics and measurement. Embrace new technologies like AMC, which involves using a data clean room to bring together various signals, including campaign and advertising data, and run analytics on them. This helps in understanding the performance of different advertising efforts, enabling more informed decisions on budget allocation.

Additionally, businesses can incorporate first-party signals and data, such as POS (point of sale) data, into the AMC (amazon marketing cloud) clean room solution. For instance, a bike seller can use hashed POS data to analyse how their campaigns are driving customers to their showrooms. This comprehensive approach allows for real-time insights and better decision-making. I encourage the industry to consider this as the next significant leap in leveraging data and technology for business growth.”