What Is Commerce Media

The evolution of commerce media

Commerce media didn’t emerge overnight- it’s the result of years of innovation at the crossroads of advertising and retail. Its journey began with the rise of retail media networks (RMNs), pioneered by companies like Walmart and Amazon, who recognized the untapped potential of their digital real estate. Let’s break down how commerce media evolved and why it’s now a driving force in the marketing world.

Retail media networks

Back in the early 2010s, Amazon was one of the first to transform its website into an advertising powerhouse. It realized that brands would pay to advertise directly on its platform, where millions of consumers were already searching for products. This was a game-changer- it allowed advertisers to target customers based on real shopping behavior, rather than broad demographics or interests.

Not long after, Walmart followed suit, launching its own retail media network to capitalize on its massive customer base. The concept was simple but revolutionary: turn their website and app into a space where brands could run highly targeted ads. These ads weren’t just placed randomly; they were strategically embedded in the shopping experience, offering value to both the customer (through relevant product recommendations) and the advertiser (through better conversion rates).

As retail media networks gained traction, it became clear that this model could extend beyond traditional retail. Enter commerce media networks- a broader, more inclusive concept. While retail media focuses on advertising within a retailer’s ecosystem, commerce media goes further by integrating ads across a wider range of touchpoints, including websites, apps, and even social media platforms.

Criteo, one of the key players in this space, saw the potential to scale this model beyond individual retailers. Criteo’s platform enables brands to run performance-driven campaigns across a network of commerce-related sites, leveraging shopper data to deliver highly personalized ads. This expansion turned commerce media into a full-funnel strategy, where ads could target consumers from awareness to conversion and even post-purchase engagement.

Key components of commerce media and how they drive customer engagement and sales

Commerce media operates on a dynamic ecosystem of tools and strategies designed to connect brands with consumers at the right moment. Whether it’s through on-site ads, off-site partnerships, or tailored content, each component plays a unique role in driving sales and enhancing the customer experience. Let’s break down the key components of commerce media and see how they work in action.

1. Sponsored products

Sponsored products are perhaps the most straightforward and familiar element of commerce media for driving immediate conversions. These ads appear directly within search results or product listings on a retailer’s website, often marked as “sponsored” but designed to blend seamlessly with organic content. The goal? Capture attention at the moment of intent- when shoppers are actively searching for a product.

• How It Works– Brands bid on keywords to have their products featured more prominently in search results. For instance, if someone searches for “wireless headphones” on Best Buy’s website, a pair of Sony headphones might appear at the top of the list, flagged as a sponsored product.
• Why It’s Effective– These ads target shoppers who are already in the buying mindset, making them highly effective for driving conversions.

2. Display ads

Display ads are designed to promote products or brand awareness and interest across various touchpoints within the retailer’s ecosystem. These can take the form of banner ads, video ads, or carousel ads, placed strategically on homepages, category pages, or even in email newsletters. Display ads aren’t just about immediate sales- they’re about building awareness and nurturing interest over time.

• Example: Imagine a customer browsing Lenovo laptops on Best Buy’s website. They may see a banner ad featuring Sony’s latest noise-canceling headphones, encouraging them to consider a complementary product. This cross-promotion strategy not only boosts visibility for Sony but also enhances the shopping experience by offering relevant suggestions.
• How It Works: Retailers leverage customer data to display ads that align with individual shopping behaviors, ensuring ads are personalized and timely.

3. Off-site ads

Off-site ads take commerce media reach beyond the retailer’s website, reaching customers across other digital platforms. This approach allows brands to target potential buyers on social media, search engines, publisher sites and even physical store, driving traffic back to the retailer. It’s an essential strategy for expanding reach and re-engaging shoppers who may have shown interest but didn’t complete a purchase. This is still lacking attribution tracking in case of physical store but maybe in future some innovation can breakthrough the challenge.

• Example: Let’s say a customer browsed a Lenovo laptop on Best Buy but didn’t buy it. Later, while scrolling through Instagram, they might encounter a retargeted ad for that same laptop, co-branded with Best Buy. This off-site ad reinforces the brand message and encourages the customer to return and complete their purchase.
• Brand Partnerships: Sony and Best Buy might collaborate on a campaign where ads for Sony’s electronics appear across various digital and physical platforms, driving traffic to Best Buy’s product pages. These partnerships benefit both parties by sharing audiences and boosting sales for both brands.

Commerce media’s power lies in its ability to create a seamless, multi-channel experience. Sponsored products drive immediate action, display ads build brand awareness, and off-site ads extend reach and engagement. Together, these components create a holistic strategy that guides customers from discovery to purchase and beyond.

Benefits of commerce media for brands and retailers

Commerce media doesn’t just benefit retailers- it creates a thriving ecosystem where brands, advertisers, and even consumers gain value. At its heart, commerce media transforms everyday shopping experiences into opportunities for brands to connect meaningfully with customers, while retailers unlock new revenue streams. Let’s explore the specific benefits for both brands and retailers, with relatable examples that show how commerce media makes the digital marketplace more engaging and rewarding.

1. Retailers unlock new revenue streams

For retailers, commerce media turns their digital platforms into monetizable spaces. Just like placing tempting chocolates or magazines near the checkout aisle, commerce media places highly relevant ads in strategic spots online, encouraging impulse buys and cross-selling.

• Example– Imagine a shopper visiting a department store’s website and browsing the luggage section. Alongside the suitcases, they see ads for travel insurance, vacation packages, or hotel deals. Suddenly, what started as a search for a suitcase became an invitation to plan an entire trip. For the retailer, this not only boosts ad revenue but also enhances the shopping experience by offering added value.
• Why It Matters– Retailers can generate additional income from ad placements, even if the shopper doesn’t make a purchase right away. It’s a win-win: more revenue for the retailer and a more engaging experience for the customer.

2. Brands reach consumers at the perfect moment

Brands benefit by getting their products in front of shoppers at exactly the right time- when they’re already in a buying mindset. Commerce media allows brands to target consumers based on real shopping behavior, making their ads more relevant and impactful.

• Example– A shopper browsing the grocery section might see an ad for a same-day grocery delivery service. It’s like spotting a keychain or pack of gum at the checkout in a physical store—convenient, relevant, and hard to resist. For the delivery service brand, this is a golden opportunity to capture attention when convenience is top of mind.
• Why It Matters– This precise targeting helps brands drive conversions and build awareness in a context that feels natural rather than intrusive. It’s about adding value rather than interrupting.

3. Enhanced customer experience

Commerce media isn’t just about selling- it’s about enriching the shopping journey. By presenting customers with relevant, timely ads, brands and retailers can create a more seamless, helpful experience that feels curated rather than cluttered.

• Example: A shopper looking at fitness equipment on a retailer’s site might encounter ads for virtual workout classes or healthy meal delivery services. These suggestions complement their purchase and show that the retailer understands their needs, making the shopping experience feel personalized and thoughtful.
• Why It Matters: Customers appreciate when brands anticipate their needs and offer helpful solutions. This not only improves satisfaction but also fosters loyalty and repeat business.

4. Cross-industry collaborations create unique opportunities

Commerce media allows brands from different industries to collaborate in ways that enhance the customer journey and create mutual benefits.

• Example: Best Buy running ads for Sony TVs on its platform benefits both companies, but commerce media can also support more creative partnerships. For instance, a luxury handbag brand could advertise on a fashion retailer’s site, or a wellness app could promote its services on a health food store’s platform. These collaborations expose brands to new audiences and create a more holistic shopping experience.
• Why It Matters: These partnerships expand the reach and allow brands to tap into new customer bases, driving growth and innovation.

5. Measurable results and optimized campaigns

Commerce media platforms provide detailed insights into campaign performance, allowing brands to measure effectiveness and optimize in real-time. This data-driven approach ensures that marketing budgets are spent efficiently and that ads continuously improve based on customer response.

Brands can fine-tune their strategies, focus on what works, and maximize ROI. Retailers also gain insights into customer behavior, helping them make better decisions about their own product offerings and site design.

Challenges in the commerce media landscape

While commerce media offers immense potential, it comes with its fair share of challenges. One of the biggest hurdles for advertisers is scaling reach. Unlike broader ad networks like Google or Meta, commerce media networks often operate within closed ecosystems, meaning brands can only reach shoppers within a retailer’s audience. This limits scale and requires advertisers to diversify across multiple platforms to maximize impact. However, this leads to another challenge: managing multiple service providers. Brands and agencies often need to sign up and navigate platforms like Amazon, Walmart Connect, and Roundel (Target’s media network) separately. Each comes with its own rules, interfaces, and performance metrics, adding complexity and workload.

Another significant challenge is delivering a seamless omnichannel experience, connecting online engagement with offline purchases. While digital ads can drive awareness and consideration, tracking their influence on in-store sales remains tricky. Bridging the gap between digital and physical retail requires sophisticated data integration, which many brands and retailers are still working to perfect. Overcoming these challenges will be critical for commerce media to truly unlock its full potential.

Commerce media vs. traditional advertising

Traditional advertising channels like Google and Meta have long been the go-to platforms for reaching potential buyers. They excel at identifying broad intent- knowing that someone is interested in buying a TV, for example. However, commerce media takes it a step further by leveraging real-time shopping data to deliver hyper-targeted ads. It doesn’t just know that a user is interested in a TV; it knows exactly which brand and model they’re considering, based on their search or browsing history.

This level of precision gives commerce media a significant edge. Ads can be tailored to specific products, offering relevant deals or accessories that match the shopper’s exact needs. It’s like moving from casting a wide net to using a finely tuned fishing rod-less guesswork, more relevance. This not only boosts conversion rates but also enhances the customer experience by delivering ads that feel helpful rather than disruptive.

Ethical considerations and privacy in commerce media

Privacy regulations are reshaping the digital advertising world, with platforms like Google and Meta feeling the heat from tighter laws and Apple’s privacy-first policies. Apple’s introduction of App Tracking Transparency (ATT), for instance, has limited how advertisers track users across apps and websites. Meanwhile, VPN usage is on the rise, making it harder to gather accurate location and behavioral data. In this evolving landscape, commerce media offers a compelling alternative. Leveraging first-party data collected directly from consumers on retailer platforms sidesteps many privacy concerns that plague traditional ad networks.

Apple itself is a prime example, having launched its ad network to capitalize on its ecosystem’s rich data. On another front, platforms like TikTok, WhatsApp, and Instagram are integrating in-app stores, transforming social spaces into shopping hubs. This shift empowers brands to engage consumers in more privacy-compliant ways, while still delivering personalized experiences. The challenge now lies in balancing personalization with transparency, ensuring that customers feel their data is being used ethically and responsibly.

Future trends in commerce media network

The future of commerce media is poised for rapid evolution as more players recognize its potential and carve out their share of the pie. Traditional retail giants like Walmart, Amazon, Target, and Best Buy continue to refine their media networks, but the landscape is no longer limited to retailers alone. New entrants, like Merck venturing into health-related commerce media or Ticketmaster exploring event-driven ads, are pushing the boundaries of what commerce media can encompass. This expansion means opportunities for brands across industries to tap into highly targeted audiences.

The next frontier? Integrated platforms that bring multiple networks under one roof. Imagine a system where a brand can seamlessly launch campaigns across Walmart, Amazon, Apple, and more, without juggling separate platforms. Such innovation would unlock unprecedented scale and efficiency, making it easier for advertisers to reach consumers wherever they shop. As the ecosystem grows, the key will be fostering collaboration and technology that unifies these networks, delivering both convenience and results.

Now that you know what is commerce media and its growth potential let’s work together to craft a data-driven, results-oriented commerce marketing plan tailored to your business. Reach out today and take the first step toward transforming your digital marketing game!

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