Most businesses by now are well versed with the consequences of the COVID-19 pandemic: Faltering offline sales, flexible work-from-anywhere options, fluctuating foot traffic with lockdown mandates, and e-commerce becoming a channel many brands wished they had built infrastructure for earlier.
As a record number of consumers in Southeast Asia move from shopping malls to online platforms like Shopee, Lazada, Tiki, and Tokopedia, advertising dollars are naturally flowing in. Emerging markets are witnessing the advent of retail media right now.
Amazon paved the way in North America 2018 by launching Amazon Advertising to become the first bid-and-buy marketplace. BCG now estimates retailers have a $100 billion business opportunity to capture if they can keep up.
The money is where the consumer is
To understand why retailers will capture more ad spend, it’s essential to evaluate what modern-day marketing has become.
As the world becomes more connected and the lines between offline and online blur, modern-day marketing mixes all the channels tied to key performance metrics. Is it bus stop advertisements? Bidding on Google keywords or a Clubhouse session? Or is it a viral TikTok video?
The main goal of marketing, no matter the medium, is to highlight a business or product to the right consumers to score a potential sale. And like most things, there is a bad, a good, and a much better way of doing things.
E-commerce as an advertising channel is unique because it encapsulates the entire consumer journey from start to finish, especially as marketplaces continue stealing the share of search engines’ searches.
Traditional marketing channels were primarily linear TV, radio, and print because the mediums were prevalent. However, with the birth of the internet, newer platforms emerged, such as email, websites, and streaming. Then came the rise of social media and apps that shook up the advertising landscape. But regardless of these shifts, there has always been one constant: The business went where the consumer was.
So when traffic and revenue sources change again, let’s say due to a pandemic, the marketing mix follows. According to Nielsen, in the next 12 months alone, many marketers plan to decrease spending in cinema, print, and out-of-home (OOH), while the majority will increase budgets in social and search.
The search for superior advertising channels
So which channels will benefit as money flows out of outdated buckets? How? Because the most valuable advertising channel is the one that has the most measurable touchpoints with the consumer. A good indicator is ad revenue trends in mature markets like the U.S. While Google and Facebook remain the dominant advertising players, Amazon has eaten into the duopoly’s ad revenue pie in the U.S., growing its share from 7.8% to 10.3% in 2020 alone, according to eMarketer.
