The following report is by Marketing Brew (excerpts):
The wholesale retailer is still testing such capabilities, and it’s fielding offers from potential ad-tech vendors, but the move signals that the third-largest retailer in the US could become a formidable player in the already deeply fragmented retail media space, which is estimated to reach $166 billion by 2025, and responsible for 20% of all digital media spend this year, according to eMarketer.
“Not only will we help you reach a Costco member, we will help you reach the right members in the right context based on past behavior,” Mark Williamson, AVP of retail media at Costco, told Marketing Brew.
Williamson, who previously held roles at Sam’s Club and Ahold Delhaize, joined Costco in September to fill a newly created retail media position, and is spearheading the push. The company is currently doing beta tests using its audience data to target users on other websites, he said, and it will eventually test targeting on its own site.
For example, a brand that sells baby products would likely prefer to advertise in front of customers who buy baby products, he said.
Because of the company’s membership cards, which are, unlike other major retailers, required to shop, Costco can tie individual purchases to shoppers’ households, both in-store and on Costco’s e-commerce site, Williamson said. This could theoretically help advertisers reach potential customers and tell advertisers whether customers saw an ad for the product before making a purchase.
Companies including Target, Walmart, Sam’s Club, Best Buy, and Kroger have all branched out into advertising to capitalize on customer shopping data, which has grown even more valuable as state-level privacy legislation, along with walled-garden tech platforms like Google and Apple, make ad targeting and measurement across platforms more challenging. Retailers aren’t the only ones getting in on the retail media frenzy: Uber, Marriott, and Chase have also all propped up their own ad networks.
Compared to other major retailers, Costco is late to the party. Back in 2021, Walmart announced an expansion of its advertising ambitions, partnering with The Trade Desk. Last year, its global advertising business, which includes its retail media network, generated $3.4 billion in revenue, per the company’s FY23 earnings report.
Meanwhile, Target’s retail media network, Roundel, contributed more than $1.5 billion in “value” for the company, Cara Sylvester, Target’s chief marketing and digital officer, told investors during the company’s most recent earnings call.
AUTHOR COMMENTARY
There seems to be this radical push by major companies and fintech firms to sell all our private data to companies for ads and AI training. It’s a complete joke. Nothing is sacred anymore. They don’t say it here, but this is to help eventually build the new coming tokenized world economic system – more on this in future reports.
2 Timothy 3:1 This know also, that in the last days perilous times shall come. [2] For men shall be lovers of their own selves, covetous, […]
Proof that we are in the “last days” is the highly addictive drug of covetousness and greed that is all over the streets for free. We cannot escape the endless pushes to buy, or ourselves and our privacy be sold at the drop of a hat.
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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I shop as Costco, not nearly as much as before, but one way to have more privacy (if that even means anything anymore) is to buy a lot of gift cards with your card, in $50 or $100 denominations. Then, when you go to checkout, you say you don’t have a membership (they call it a 99), and pay with the gift cards. They could of course go back to their history and see what gift card bought what, but it’s more work for them than to just take the data from the Citi card that they issue. This is really a shame, and soon I imagine Costco will turn to facial recognition and biometrics to enter the store and then to checkout.
I visited a Costco on one or two occasions before I got out of the city, and I do not feel at all deprived by not having one of those ugly stores nearby. I sensed that the pressure was on to become a member, and I am glad I dodged that bullet. These wholesale type places have been around since the 1980s as far as I can recall, and I have disliked every one of them. I wonder if the cashiers faint if someone purchases something with cash.