Ecommerce momentum has tailed off since final yr, however world ecommerce and retail media nonetheless have loads of room for development, in response to GroupM’s 2022 Ecommerce and Retail Media Forecast.
GroupM estimates ecommerce will account for 19% of worldwide retail gross sales this yr, and that ecommerce fee will develop to 25% by 2027.
World retail media spend will possible attain $101 billion this yr, a 15% YoY enhance from $88 billion in 2021.
Whole world retail media spend will hit $160 billion by 2027, which represents a 60% development fee over 5 years, GroupM predicts.
Progress will largely be pushed by the world’s largest retail gamers: names like Alibaba, Amazon and Walmart. However there will likely be elevated competitors within the class over the subsequent one to a few years as extra retail networks emerge and extra non-endemic manufacturers get into retail media promoting.
The ecommerce slice
World ecommerce gross sales for 2022 will complete $5.4 trillion, in response to GroupM. Ecommerce gross sales within the US and China make up 52% of that determine. Simply seven markets – the US, China, Japan, Germany, the UK, Canada and Australia – account for almost 61% of complete ecommerce gross sales, or $3.3 trillion.
The worldwide ecommerce complete is anticipated to develop to $9.1 trillion by 2027.
If historical past is any indication, ecommerce gross sales development over that interval will likely be concentrated among the many high 20 gamers in world ecommerce. In 2016, the highest 20 ecommerce firms by gross merchandise worth (GMV) accounted for nearly half of worldwide ecommerce gross sales; by 2021, their share was as much as two-thirds.
It’s vital to notice that GroupM’s definition of ecommerce consists of many classes common internet customers could not consider as typical ecommerce, whereas excluding others. GroupM consists of on-line gross sales of autos, auto components and gasoline, but it surely doesn’t rely on-line ordering for “final mile restaurant supply” and different meals companies.
Promoting companies like Criteo, software program suppliers like Shopify and gross sales accomplished via Google Procuring or social platforms like Meta and TikTok are additionally not included in GroupM’s projections for ecommerce or retail media gross sales. That’s out of concern about double-counting gross sales, since a sale pushed by Criteo, Google or Meta is a sale attributable to the service provider, too.
Retail media spending
GroupM’s projection of $101 billion in retail media spend for 2022 represents 18% of complete world digital promoting and 11% of complete world advert spend.
And the $101 billion determine could be equal to 1.8% of worldwide ecommerce GMV for 2022.
GroupM considers 5% of ecommerce GMV to be an affordable objective for ecommerce platforms to set for his or her share of retail media advert income.
This 5% GMV objective is predicated on GroupM’s evaluation of Amazon’s advert enterprise; though Amazon doesn’t distinguish between streaming video advert income and ecommerce advert income in its reporting, GroupM estimates that Amazon’s retail media income is roughly 5% of its complete GMV.
Retail media income for many of the different high ecommerce firms at the moment falls between 0% and three% of their GMV, which places the 5% objective inside attain, in response to GroupM.
The 60% development fee of the retail media market from now till 2027 will likely be pushed by the proliferation of retail media networks and the shift of incremental spend from different media channels, even from non-endemic manufacturers not carried in shops, as advertisers uncover and take a look at retailer platforms, in response to the report.
However that 60% development fee, and the $160 billion in complete retail media spending it tasks for 2027, could even be underselling the retail media potential, stated Kate Scott-Dawkins, GroupM’s world director of enterprise intelligence.
GroupM’s projected 60% development fee for retail media over the subsequent 5 years would possible outpace digital promoting’s total development fee, which was 24% in 2021, Scott-Dawkins stated. Since retail media is rising at a sooner clip than the remainder of digital, retail media will proceed to earn a bigger share of complete advert spend.
“We predict our retail media forecast is a bit on the conservative facet, and this market might develop much more rapidly,” she stated. “If that share elevated even 1% every year, you rapidly get to a spot the place it’s $200 billion in 2027.”
