Microsoft is looking to further ingrain itself into the growing interest in retail media, with plans to launch its own ad network that is integrated with its existing technology solutions.
The Microsoft Retail Advertising Network is designed to make it easier for retailers to monetize their onsite inventory and become part of the boom in retail media offerings. The network will allow for retailers to drive incremental shopper traffic to their website and partner with brands that use the broader Microsoft Advertising platform.
By providing connections to more advertisers looking for ad inventory, Microsoft says the platform is meant to help retailers that have been developing retail media offerings but have hit a “saturation point” where they cannot get more demand from their existing brand partners. Department store chain Kohl’s has signed on as a partner for the pilot phase in the U.S.
GroupM’s latest forecast estimated that retailers globally earned $88 billion USD in revenue from selling ads last year, a number it expects to reach $101 billion USD – roughly 18% of digital advertising and 11% of all advertising. It further predicted that retail media advertising will grow by about 60% by 2027, exceeding that of all digital advertising. In the U.S., where retail media is most developed, Forrester predicts retail media spending to double over the next four years.
Microsoft’s ad network will be offered as part of PromoteIQ, the company’s retail media platform. Microsoft first acquired PromoteIQ in 2019. Retailers like Kroger and Sephora have since adopted the platform as part of their own retail media offerings.
In addition, Microsoft has also announce PromoteIQ Offsite, which will enable retailers to activate their first party audience data on third party inventory. Initially, this will include audiences on Meta platforms using lookalike modelling, but the company says it can also be used for platforms like connected TV.
Microsoft also said it has completed the proof-of-concept for PromoteIQ In-Store, giving it the ability to extend integrated retail media advertising into physical environments. However, because in-store requires additional hardware and set-up, it expects it to be available at some point within the next 12 months as it works with partners to create an interoperable platform.
The announcements were made ahead of the NRF 2023 retail conference, where retail media looks to be a big subject. Earlier this week, Salesforce announced its own new retail media offerings that will be display at the show.
