Why Search Remains the Backbone of Retail Media and Which Search Products Drive the Best Results

The Ongoing Power of Search in Retail Media
While new media channels like social and streaming ads gain traction, search remains a vital part of the retail media ecosystem. In 2023, search accounted for nearly 45% of total retail media ad spend, underscoring its continued dominance in the digital marketing landscape. This popularity is fueled by its direct link to purchase intent—70% of shoppers use search to find product information before buying. Search advertising provides brands with high visibility at critical points in the shopping journey, offering unique targeting capabilities that align with both short-term conversions and long-term brand-building goals.

1. Why Search Is Indispensable for Retail Media

• High Purchase Intent: Unlike other ad formats that may focus on brand awareness or engagement, search ads reach consumers at the moment they are actively searching for products, making them closer to a purchase decision. Google reports that 90% of people who use their platform for product searches haven’t yet decided on a brand, meaning search ads can significantly influence brand choice.

• Data-Driven Insights: Retail search ads leverage first-party data, allowing retailers to offer highly targeted ad placements based on past shopping behavior, preferences, and demographics. Amazon’s search ads, for example, drive more than 40% of the platform’s total ad revenue, illustrating how data-driven targeting can maximize relevance and performance.

• Effective ROI and Attribution: Search ads are not only effective but also easy to track, allowing brands to measure clicks, conversions, and ROI with precision. Retail media platforms often provide granular insights that help advertisers understand their customers’ journeys, informing future strategies.

2. Types of Search Products to Leverage and Why

To capitalize on the benefits of search, brands should utilize a mix of search products designed to capture demand across various stages of the purchase funnel. Here’s a breakdown of some essential search products in retail media.

• Sponsored Product Ads
  Sponsored product ads are the most popular form of search advertising within retail media, driving 85% of retail search ad revenue on platforms like Amazon and Walmart. These ads appear in search results and product detail pages, making them a high-visibility option that targets users actively looking for similar products. Sponsored product ads work effectively because they:

• Capture High Intent Traffic: These ads reach shoppers who are actively searching for or viewing related items, increasing the likelihood of conversions.

• Drive Measurable Sales Impact: According to Amazon, brands using sponsored product ads see an average return on ad spend (ROAS) of 2.7x, making it a reliable choice for brands looking to boost visibility and sales.

• Sponsored Brand Ads
  Sponsored brand ads appear at the top of search results and allow brands to showcase a logo, headline, and multiple products. This ad type is designed to drive brand awareness and is ideal for capturing shoppers in the early consideration phase.

• Build Brand Recognition: These ads give brands prime placement at the top of search results, making them highly effective for introducing new products or promoting seasonal offers.

• Multi-Product Promotion: With space for multiple products, these ads are ideal for cross-selling or bundling complementary items. Research shows that brands running sponsored brand campaigns achieve 20% higher click-through rates compared to single-product ads.

• Sponsored Display Ads
  Sponsored display ads allow brands to retarget shoppers who have viewed their product or similar products but haven’t made a purchase. These ads appear across the retail platform and external sites, keeping the product top-of-mind as users continue browsing.

• Remarketing Potential: Retargeting customers who showed initial interest increases conversion rates. Data from Amazon shows that display ads can lead to a 10% lift in conversions by re-engaging past viewers.

• Broad Reach and Versatility: Sponsored display ads appear not only on the retailer’s site but also on affiliated sites, helping brands reinforce their presence across multiple touchpoints.

• Product Targeting Ads
  Product targeting ads enable brands to target their ads toward specific competitor products or categories. By displaying ads on the pages of similar or complementary products, brands can attract shoppers who are already in the market for related items.

• Competitive Conquesting: Brands can capitalize on competitors’ product pages to redirect traffic and increase conversions. On average, brands using product targeting ads report a 15% increase in visibility on competitor searches.

• Cross-Promotion Opportunities: By targeting complementary products, brands can promote related items, such as accessories or bundles, thereby increasing average order value.

3. The Effectiveness of Search in Retail Media

• Conversion Rate and Cost Efficiency: According to recent studies, search ads on retail platforms yield a conversion rate of nearly 15%, significantly higher than other ad types. For instance, Amazon search ads have a cost-per-click (CPC) 40% lower than display ads, showing their cost efficiency.
  

• Ad Spend Allocation: Brands allocate about 60% of their retail media budgets to search, underscoring its reliability and impact. This allocation trend is consistent across major retail media platforms, from Amazon to Target, as brands continue to prioritize search for its direct path to purchase.
  

• Impact on Purchase Decisions: Over 70% of consumers report that search ads influence their product research and buying decisions. This statistic reflects the unique role of search ads in helping consumers navigate their purchase journey and discover new brands in the process.

4. Strategic Tips for Brands Leveraging Search Products in Retail Media

• Define Clear Objectives: Different search ad types work best for different goals. Sponsored product ads are effective for boosting sales on a single item, while sponsored brand ads are better for driving brand awareness. Understanding the purpose of each product helps in maximizing ad budgets effectively.

• Optimize for Keywords and Competitor Targeting: Researching high-performing keywords and targeting competitor products can increase ad relevance. Over 50% of retail search ad clicks come from non-branded keywords, highlighting the importance of targeting terms that capture broader search intent.

• Leverage Data Insights: Utilize retail media platforms’ analytics to track performance and adjust campaigns based on what’s working. For example, if sponsored product ads have a high conversion rate but a low click-through rate, brands can refine their keyword strategy to attract more engaged users.

• Experiment with A/B Testing: Testing different ad types, copy variations, and placements helps optimize campaign performance. A/B testing has been shown to improve ad performance by up to 30% on retail media platforms, as brands gain insights into what resonates most with their audience.

5. The Future of Search in Retail Media: New Opportunities and Innovations
Retail media platforms are constantly evolving their search products to meet changing consumer behaviors. As voice search and AI-driven recommendations become more common, search ads may incorporate these advancements to deliver an even more personalized experience. For example:

• Voice Search Optimization: As more consumers use voice commands to search for products, optimizing search ads for voice-friendly keywords can help brands stay visible.

• AI-Powered Recommendations: Platforms like Amazon are increasingly using AI to recommend products to users, integrating search ads more seamlessly into the shopping experience.

Conclusion: Embracing Search as the Cornerstone of Retail Media Advertising
While new channels continue to emerge, search remains the foundation of retail media because it captures intent-driven consumers at critical stages of the purchase journey. By investing in a mix of search ad products, brands can meet consumers wherever they are in the funnel, from awareness to conversion. As search capabilities continue to evolve with advancements like voice search and AI, the potential for brands to reach, engage, and convert shoppers through retail media search ads is only set to grow.

By prioritizing search as part of their retail media strategy, brands can maximize their ad spend, achieve measurable results, and build a strong presence across retail platforms, ultimately driving both visibility and sales in a competitive landscape.

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