Criteo’s Kenneth Pao examines the advent of commerce media, which marks a new era of digital advertising that is aimed at addressing the increasing calls for consumer privacy.
Just as how the tools in a toolbox come in various shapes and sizes to repair different household items, variations of AI technology are continuing to emerge so that they can meet the evolving and unique industry-specific challenges across sectors. To illustrate this concept, there is no better example than the discussion of AI’s evolving role in advertising.
In the early stages of AI deployment in advertising, brands focused purely on utilising AI to amass third-party data and share relevant recommendations to customers, such as Amazon’s user-based collaborative filtering function in 1998.
Today, the new kid on the block in the AI-vertising space is commerce media. Commerce-focused AI takes on a complex role of analysing large-scale purchase and intent data to improve advertising returns on the open internet for marketers and media owners in an addressable media future.
Given the novelty of this emerging advertising technology, APAC brands are still not recognising its vast potential. In fact, even though marketers in the region lead their European and North American counterparts in terms of AI adoption in their marketing and advertising strategies, many are unaware of how they can curate a privacy-first approach with the right AI tools amid third-party cookie phaseout.
Considering the unpreparedness of APAC brands as we are advancing towards the phaseout of third-party signals, there is an urgency for brands to understand more about the “what”, “how” and “why” of commerce media.
Rapidly growing consumer base brings additional challenges
The region gained more than 70 million online consumers during the pandemic, and as a result APAC remains the largest market for retail e-commerce, with digital sales amounting to nearly US$2.992 trillion in 2021.
Hybrid path to purchase
This rapidly growing consumer base brings great opportunities but also additional stressors for APAC brands. For one, shoppers are increasingly taking a hybrid path to purchase – more than seven in 10 APAC shoppers claim that they will either browse products online and then purchase them in a retail store, or make purchases online after seeing a product at a retail store.
Multiple internet devices
In addition, APAC shoppers are browsing more on multiple internet devices, with most owning and actively using at least three internet-enabled devices every week. Concurrently, shoppers are increasingly reliant on retail or brand websites for relevant product discovery and research.
What this means for brands is that they are suddenly faced with an unprecedented amount of consumer data rolling in across physical stores and several online platforms. Moreover, consumers are expecting brands to rapidly create a seamless omnichannel shopping experience with personalised advertisements that can enable their discovery and research in a privacy-compliant manner.
Coupled with the constantly evolving data privacy regulations and frameworks introduced by APAC governments over the past two years, it’s no surprise that many APAC brands are struggling to adapt their consumer engagement strategies in a privacy-first manner – something that they are only challenged in recent years to prioritise.
Uncovering latest AI tool in adtech toolkit
Considering the fast-growing consumer base and shifting data privacy regulations amid concerns about the gradual phaseout of third-party signals by 2024, there is a need for APAC brands to start looking at alternative AI tools to engage the addressable media audience.
Hence, it is time to learn more about the latest AI tool in the adtech toolkit – commerce media.
Born out of necessity, commerce media marks a new era of digital advertising that is aimed at addressing the increasing calls for consumer privacy. It is a first-party data-based, intelligent and full-funnel solution that enables marketers to put aside a channel-by-channel approach and create advertising strategies based on high-value audiences across all channels, devices and formats.
Seamless online to offline experience
There are several ongoing challenges faced by APAC brands that commerce media can help solve. For one, with increased pressure to create a seamless online to offline experience for APAC consumers, commerce media can help marketers do this by directly connecting audience impressions with omnichannel transactions and business results through commerce-focused AI.
In addition, onsite and offsite retail media that sit under the commerce media ecosystem allow brands to take advantage of the vast data sitting across online and physical platforms and as a result, seamlessly address an omnichannel shopper journey to drive measurable sales results.
Real-time, inter-device, first-party signals
Moreover, with an extensive commerce data set, real-time, inter-device, first-party signals from billions of active shoppers who might be using multiple devices to shop will all be analysed on the commerce media platform. This resolves yet another challenge that APAC brands face – their regional shoppers expecting them to effectively analyse their huge pool of shopper data across multiple devices and then, share more personalised advertisements that can help consumers enable product discovery and research.
Taking AI-propelled leap to addressable media future
Faced with a fast-growing consumer base that is increasingly reliant on brands to create personalised experiences in a privacy-compliant manner, alongside the impending phaseout of third-party signals amid a constantly evolving data regulatory landscape, brands in Asia Pacific are challenged to operate in one of the most demanding advertising eras of all time.
However, just as how the region has been able to adapt to new ways of harnessing the power of AI over the last two decades, I firmly believe that we will be able to do the same today and emerge stronger in the open internet tomorrow.
From creating a seamless online to offline experience, to amassing real-time, inter-device, first-party signals to drive commerce outcomes, I am excited to see how regional brands will embrace the latest tools in their advertising toolbox to thrive in an addressable media future that is wide open.