By Jeff Bander, Head of U.S., EyeSquare
Advertising and retail are in flux. The past two years have seen radical changes in nearly every aspect of the shopping experience: the way brands market to customers; the way consumers search for the products they need; the way goods are shipped and collected; and how consumers pay for their purchases.
In a period of such comprehensive change, it can be difficult to assess the impact of a single trend. However, one overarching shift can help to explain many of the other changes taking place in retail and commerce: the convergence of media and retail. This trend is having profound effects on consumer behavior, and the brands that have recognized this new environment are poised to take advantage.
The Rise of Retail Media
It can be instructive to look at the role of major social media platforms like Facebook, Pinterest, Instagram and TikTok. By providing an outlet for celebrity influencers to communicate directly with consumers, these sites have fundamentally shifted how leading brands advertise to their most valuable customer segments.
More recently, these platforms have moved from inspiring transactions to facilitating them directly. As social media’s command of consumer attention increases, the importance of traditional advertising channels will decrease accordingly.
While social media’s role in online retail continues to evolve, so too do the roles of “retail media” and Amazon. For many years, the global shopping giant was the final destination for millions of purchases: even when consumers would visit a brick-and-mortar store to test out an item, they would turn to Amazon for the purchase due to lower prices and next-day shipping.
In today’s accelerated shopping environment, Amazon is both the first and last stop for shoppers. More than 50% of all digital product searches begin on Amazon, making it vitally important for brands to invest in marketing as close to the point of purchase as possible. In the United States, ad spend on retail media channels like Amazon Ads will increase by 27% to nearly $24 billion in 2021.
New Creative Needs
According to recent research from DataReportal, the average American spends more than seven hours per day looking at a screen. From mobile phones to laptops and tablets to TV, this flood of digital stimuli is having dramatic effects on human perception. In many cases, the viewer’s attention is divided between multiple screens at the same time, putting even further pressure on content creators to maintain an engaging experience.
Marketers are under constant pressure to deliver persuasive messaging within smaller and smaller windows of time. Whereas a primetime TV advertisement might have 30 seconds to make an impact, pre-roll advertising on YouTube can be shortened to just 15 seconds — with the viewer able to exit after just five. Today’s creative must be capable of engaging customers and shifting their behavior in milliseconds, moving beyond emotional and rational perception to focus instead on instinctual reactions—or System0.
Using System0 to Target Instincts
System0 – sensual (visual) perception – is the gatekeeper to all information flow regarding a customer’s experience. As the brain’s most basic intuitive process, it delivers almost instantaneous decision-making. When you no longer have the luxury of 30 seconds to tell a story to the consumer, you must fundamentally change the way you develop, test and measure advertisements.
In this context, sensory perception is key: what is the viewer’s immediate, instinctual reaction to an advertisement, and how can that content be refined to deliver improved results? System0-based experiences create an advertising environment that requires fast, “information-dense” creative e.g. images such as faces or iconic brand displays.
To better understand System0, advertisers must take the time to test their creative collateral. The most effective way to evaluate advertisements is to place them directly in the context in which they’ll appear, reducing external noise and biases.
As established above, this means evaluating consumers’ sensory reactions to advertisements in their Instagram feeds or in Amazon search results. In the right context, A/B testing can allow marketers to methodically increase the effectiveness of their campaigns by sharpening their approach to System0. The end goal of this process is to optimize each piece of creative to deliver an improved and more persuasive experience for the viewer.
The convergence of retail and media is accelerating, with no signs of slowing down in the near future. For brands and marketers to survive and thrive in this new environment, they will need to abandon their accepted best practices and conventional wisdom; instead, advertisers must appeal to System0 through a ruthless pursuit of optimization. The winners of this next stage of retail will be those who never stop improving through testing and measurement.