*This article is an overview of WARC’s Future of Digital Commerce report. All statistics included were gathered by WARC.
Welcome to the future! This year brings exciting changes that can transform how you connect with customers and grow your business. With retail media on the rise and artificial intelligence reshaping marketing, there are plenty of opportunities to explore. Understanding these trends will help you make informed decisions and stay competitive, and luckily for us WARC has put out a report to help us all navigate. Let’s jump into the key insights that will guide you through 2024.
In 2024, retail media ad spend is projected to hit an impressive $153.3 billion, showing a healthy growth rate of 13.7% compared to the previous year. This marks a slight increase from the 13% growth seen last year, indicating that more brands are investing in this powerful channel.
Key players in this space include Amazon, which is set to dominate with a share of 37.3% and expected revenue of $57.2 billion. Meanwhile, Pinduoduo is making waves in China with a 31.3% growth rate, reaching $28.2 billion.
Walmart also reported a solid 26% increase in e-commerce ad revenue. As these companies continue to lead the charge, now is the time for you to consider how retail media can fit into your strategy and drive results for your brand.
It’s no secret that artificial intelligence is making big waves in the world, and that includes the marketing world. By analyzing vast amounts of data, AI can help businesses personalize their strategies, ensuring messages hit the right notes with their intended audience. But, targeting is not all that AI in marketing can do. It has begun to play a large role in content creation too, allowing business owners to generate tailored product descriptions, social media posts that speak directly to customer preferences, and more.
Looking ahead, the AI-enabled e-commerce market is expected to grow to $16.8 billion by 2030, with a compound annual growth rate of 15.7%. This means you have a significant opportunity to integrate AI into your operations now, setting your brand up for success in an increasingly competitive environment.
Direct-to-consumer (DTC) sales are on the rise, driven by the increasing popularity of online subscription services. If you’ve spotted this trend, you’re not alone. DTC sales are expected to hit $161.2 billion in 2024.
Having an omnichannel strategy is key to keeping your customers coming back. Companies with strong omnichannel engagement retain 89% of their customers, compared to just 33% for those that don’t. If you're interested but unsure, contact the Arctic Leaf team to start this plan for your business. As an experienced omnichannel agency, we can build this presence for you.
Industry leaders emphasize the importance of meeting customers where they are, whether in-store or online. Rodney McMullen of Kroger notes that customers who shop both ways spend three to four times more than those who only shop in-store. Offering flexible shopping options can significantly boost your customer loyalty and overall sales, proving that catering to modern shopping preferences is a necessity to maintain and grow your customer base.
Data clean rooms are making big changes when it comes to marketing measurement and attributions. These secure environments allow you to use anonymized shopper data to create detailed customer segments while keeping privacy intact. Tools like Amazon Marketing Cloud can help you gain a complete view of the customer journey and accurately measure the success of your campaigns.
Brands are using clean rooms to collaborate with retailers, refining targeting strategies and understanding their audience better. However, using these rooms comes with challenges. Data governance is essential to ensure ethical use and maintain consumer trust.
While the original ‘Future of Digital Commerce’ report anticipated the phase-out of third-party cookies, recent updates indicate that this is no longer a concern. Despite this shift, clean rooms still offer significant advantages. They provide valuable insights and support more precise marketing measurements. With the right technology and expertise, you can make the most of these tools to improve your marketing effectiveness and gain a clearer view of your audience.
Banks and other companies are finding innovative ways to monetize customer data. For example, Chase and PayPal have launched media solutions that leverage their vast customer data to create targeted advertising opportunities. This trend shows how valuable customer data can be when used ethically and effectively.
Gaming commerce is also emerging as a significant new marketing channel. Walmart's collaboration with Roblox allows players to shop for groceries within the game, blending entertainment and e-commerce in a unique way. This approach opens new possibilities for reaching younger audiences in interactive environments.
A standout case is Mondelez International, which used AI to revamp its snack flavors. By analyzing extensive flavor preference data, they successfully created new products that outperformed their predecessors. These examples highlight the diverse and innovative ways companies are utilizing data to boost their marketing efforts and connect with consumers in exciting new ways.
Convergence, where different elements come together to form a unified whole, is a driving force in digital commerce. It’s reshaping how brands manage data and forge partnerships. By integrating data from various sources, you can gain a comprehensive view of customer preferences and behaviors. This allows for more precise targeting and personalization.
Brands are also consolidating their media partnerships, focusing on fewer but more impactful relationships. This strategy ensures a more efficient use of resources and delivers superior outcomes. However, to maintain this advantage, you must be prepared to adapt. This involves updating your data strategies, investing in appropriate technology, and cultivating robust, strategic partnerships.
In this fast-paced digital world, staying static simply is not an option.
The future of digital commerce is bright, inspiring, and full of opportunities. With AI and retail media transforming the way businesses connect with customers, the potential for growth is immense. By employing omnichannel strategies, leveraging data clean rooms, and exploring new channels like gaming commerce you can set yourself apart from the rest. Stay informed, adapt to the latest trends, and harness the power of convergence to keep your marketing efforts effective. A world of digital commerce awaits, and by staying proactive, you can lead your brand to new heights this year and beyond.