Indeed, exchanging second-party data is one way to maximize the reach of the customer audience. The biggest retailers are already capitalizing on their customer data. The reality is this is happening, today, in real time. Start gradually: If you’re uncertain, start small and test the waters, it’s much easier to scale things up than to make major adjustments to a program that isn’t operating as planned.Establish data-sharing best practices: Data partnerships need to be valuable to all parties, creating clear guidelines for how data will be shared, stored and used.Bring on publishing expertise: Few retailers have media publishing in their DNA so it’s important to either bring someone on who has that experience or work with a partner who can navigate these new waters.How can a retailer make the media path work for them? Here are a few ideas: The other big retailers mentioned above have all followed suit and each of them now has a new revenue stream.Īnd why not? Why not create data partnerships that benefit both retailers and their brand partners? And what is preventing other retailers from jumping on the media company bandwagon as well? Why not make this data available even to brands that aren’t selling through a retailer but want to reach the retailer-as-media-company’s audience? Open the data floodgates to brand partners and let them use data to reach customers more effectively on the company’s properties and beyond. The logic behind Amazon’s morphing into a media company is as sound as it is simple. Given Amazon’s continued dominance at all things retail, its media business is heading in one direction: up. Think about it in perspective: this is essentially found money for Amazon and they can use it to do things like funding their entire marketing budget and then some. Perhaps not much compared to Google ($79 billion) or Facebook ($27 billion) but it’s still a tidy sum. How much revenue? Dan Salmon, managing director for media and internet equity at BMO Capital Markets, believes Amazon could see as much as $5.7 billion in ad revenue in 2018. Were there doubters when the company floated this idea? Of course, but time - and revenue - changes everything. What Amazon did with its Media Group is to allow brands to target customers with advertising using the company’s super-rich data. Retailers have always had this data and smart online retailers have been using it to make product suggestions for a while now. Retailers too stubborn, short-sighted or just plain too foolish to follow Amazon’s media path will put themselves firmly on the road to financial decay.Īmazon (quickly followed by other retailing behemoths, including Best Buy, Target and Walmart) recognized they have a lot of really interesting audience data. It’s a reality other retailers need to recognize and replicate if they hope to survive in a world where retail dominance and media might are tightly entwined. Then came the Amazon Media Group and over the past several years, their development - and similar ones by other retailers - have redefined what it means to be a media company.
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