Many shoppers also research products on digital channels while shopping in brick-and-mortar stores. According to a Google study, 71% of consumers use their phones while shopping in-store and say that their phones have become more critical to the in-store experience.
Offline sales can lead to massive impacts over time. One leading laundry brand found that their Amazon paid search campaigns generated a 10% increase in point-of-sale (POS) velocity in-store, according to the DSI “The Full Revenue Impact of Retailer Ad Platforms” report.
The report also showed a leading household cleaning brand found that their media mix modeling (MMM) campaigns lead to $7 in returns in offline channels for every $1 spent on Amazon advertising.
A significant short-term — but also long-term — impact is your partner value. Your ad spend will support retail profitability and demonstrate a commitment to that retailer’s shopper acquisition and retention efforts.
Ad spend creates a win-win scenario for both brands and their retail partners when properly leveraged.
The Mid-Term Impact
Another “hidden” metric is the repeat rate of online customers. Retail ads will lead to more online sales, which lead to more repeat customers.
Repeat customers can also come in the form of retailer subscription capabilities or the digital visibility of shopper’s past purchase history. The DSI study found that 86% of online grocery shoppers look at their previous purchases to add to their basket.
Both online and offline sales will lead to increased social validation in the form of additional reviews. According to a Power Review study, 70% of shoppers won’t buy online without reading online reviews first.
But the more shoppers leave reviews on your product detail pages (PDP) across the digital shelf, the more likely that other shoppers are encouraged to purchase it too.
The Long-Term Impact
Repeat rates and social validation both lead to increased digital visibility. The more sales, the more your product will be featured in search results. The more repeat customers, the more your product will be featured. The more reviews, the more your product will be featured.
Your search rank will continue to improve as these factors improve. The “flywheel effect” is real: For every 100% gain in impressions, there is a 92% gain in unit sales, according to the DSI report.
The increase in sales drives more impressions, and so the cycle continues.
Social validation and offline sales will lead to increased offline placement opportunities. Proving strong ecommerce performance will provide expanded opportunities to stock your product on physical shelves.
Putting It All Together
Each of these impacts will lead to improved cost per acquisition (CPA). Better ad efficiency creates a better marketing ecosystem to further this cyclical pattern. When done well, better ad spend leads to budget efficiency, increased sales, expanded repeats and reviews, and ultimately to more visibility and placements.
Realizing the full scope of the revenue impact of your retail ad spend helps marketers understand the true return on ad spend (ROAS).
Download the complete DSI report and calculator to build your understanding of your retail ads’ true return, helping you strategize for tomorrow.