Exclusive data: Off-site ad strategies

Plus: Pinterest, CVS execs dish on data clean room MARCH 11, 2024 [Off-site advertising will play an emerging role in advertisers’ retail media strategies]( Though on-site search and display remain retail media’s bread and butter, off-site advertising—placing ads in channels outside of a [retail media network’s]( (RMN’s) own properties—will lead the next evolution due to its ability to expand advertisers’ reach and achieve upper-funnel goals like increasing brand awareness. Nearly half (46%) of advertisers say they currently activate off-site retail media when working with a retailer, according to a December 2023 survey designed by TripleLift and executed in partnership with EMARKETER. Of that, over two-thirds (68%) agree that off-site is a necessary part of their retail media strategy. Driven by a desire for full-funnel campaigns, advertisers are also exploring upper-funnel off-site channels. Top off-site formats include display (used by 36% of advertisers), online video (33%), and [connected TV (CTV)]( (26%), the survey found. Social media advertising and paid search were also cited as popular off-site formats. - US [retail media]( ad spend on CTV will skyrocket in 2024, rising 335.5% YoY to reach $3.64 billion, per our forecast. Though it will represent just 6.1% of total retail media ad spend, the money spent on retail media CTV advertising will more than double by 2027, reaching $8.64 billion. - In order to provide advertisers with more ad opportunities, some RMNs are partnering with social platforms to target their users off-site. For example, [Amazon]( teamed up with [Meta]( and Snapchat on in-app shopping ads in 2023. Story continues below. Off-site investment is growing Over half of advertisers who currently activate off-site advertising plan to increase their spend over the next 12 months, the survey found. About a third (34%) will shift these funds from existing budgets, but 21% will find new incremental budget to increase their off-site efforts. This influx of investment will help US retail media off-site ad spend grow by 64.1% in 2024 to reach $11.04 billion, according to our forecast. That number will more than double by 2027, totaling $24.02 billion. As off-site grows, so will the number of [programmatic]( activations. - Among advertisers who currently activate retail media programmatic campaigns, 90% plan to continue doing so in the next 12 months, according to the survey. Of those who don’t currently activate, 33% plan to begin in the next 12 months. - US programmatic digital display ad spend will grow 15.9% in 2024 to reach $157.35 billion, according to our forecast. Programmatic digital video ad spend will also increase, rising 20.9% to reach $93.95 billion. Off-site offers a new landscape and performance opportunities for both advertisers and retailers As retail media expands into off-site, advertisers and retailers are experimenting while also navigating off-site’s ins and outs. Performance is the most important factor for advertisers when considering activating off-site, according to the survey. But many advertisers are still deciding whether it should be used for upper-funnel or lower-funnel goals. - While 58% of brands and agencies say off-site is better for upper-funnel goals, 34% use off-site to satisfy lower-funnel goals. - Conversion rate is the top KPI advertisers are optimizing toward with off-site, cited by 56% of current off-site activators. Other top KPIs include return on ad spend (54%), clickthrough rate (48%), cost per click (46%), and online sales (45%). This illustrates a contradiction between what advertisers say they use off-site for and how they’re actually executing those campaigns, possibly due to the complexities of this fast-growing ad channel. - “The conflicting signals on what off-site spending helps marketers achieve are a testament to off-site’s potential, rather than confusion about it,” said Willens. - To ensure a full-funnel effect, advertisers can employ both off-site and on-site advertising, optimizing each against the goals they wish to achieve. Echoing advertisers’ sentiments, 71% of retailers who currently offer off-site advertising agree that it is an essential part of their retail media strategy, per the survey. For retailers, the value of off-site advertising ranges from boosting revenues to generating awareness. - Two-thirds (67%) of retailers cite increased revenues as the top factor when deciding to offer off-site advertising to their clients. The second factor (60%) was satisfying client requests, followed by scaling target audiences (57%). - Off-site can also be a great way for retailers to generate awareness without digging into their own budgets, providing an opportunity for both brands and retailers to reach a wider audience. Want to learn more about how advertisers, retailers, and third-parties can collaborate to improve the off-site retail media experience? [Download our free report]( “How off-site advertising can lead retail media’s next big growth phase.” [Read online]( [Pinterest, CVS execs dish on data clean room collab]( CVS Media Exchange (CMX), the retail media network of CVS, is the latest retailer to join Pinterest’s [data clean room]( initiative. - The data clean room, developed with LiveRamp, launched early last year with Albertsons as its first retailer partner. - Wayfair also announced it would trial Pinterest’s clean room solution. “The beauty of a clean room is that it's a privacy-centric way for CVS to share data from its 74 million Extra Care members and for us to share the data from our 498 million users, and end up with a repository of powerful, completely anonymized first-party data,” said Carrie Sweeney, VP of retail at Pinterest. “Then we can connect our users with targeted ads without sharing any of their personal data, just as CVS can on its website.” Data clean rooms enable retail media networks and partners to more accurately measure campaign performance. - Following performance measurement was the most important factor in allocating retail media spend, according to US consumer packaged goods (CPG) manufacturers, per December 2023 data from Skai and Path to Purchase Institute. - “With this technology CMX can measure attributed sales that are related to the campaigns that run on Pinterest more accurately, and then share that back with the CPG supplier, which empowers them to make more data-driven decisions,” said Sweeney. As third-party cookie deprecation approaches, advertisers will increasingly look to retail media networks for access to first-party data. - 86.0% of ad buyers in the Americas believe that first-party data is extremely or very important when deciding which retail media networks to partner with, per our November 2023 survey. - “While the industry is moving away from traditional audience identifiers, our deep first-party data gives us a strong foundation in the face of cookie deprecation,” said Parbinder Dhariwal, vice president and general manager at CMX. “This is a fantastic example of why we need to always be innovating and embracing new methods for data collaboration and analysis across the industry. Sweeney sees advertiser adoption of data clean rooms growing, with a bit of a learning curve. - 39% of US brands and agencies will be significantly or somewhat more focused on data clean rooms in 2024, per November 2023 data from the Interactive Advertising Bureau. - “Advertisers are curious about clean rooms but they want to learn more,” she said. “But it’s not a decision they’re making lightly. You have to figure out which partners to work with, how to operationalize it, consider the costs. But I think there’s a groundswell of recognition that this is a powerful option in the suite of privacy-centric tools and we’ll see more experimentation this year.” [Read online]( Email sent to: {EMAIL} If you cannot view the HTML newsletter, [please read it in your browser here](. 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