Here’s yet another wakeup call for marketers–and it has to do with how to be where your customers are and how to keep your brand safe in new environments. Temu, an online shopping platform most people never heard of, surpassed Amazon and Walmart as the most downloaded app in the U.S. It is a subsidiary of China-based PDD Holdings Inc., which also owns Pinduoduo, an e-commerce giant in China. As consumers here rushed to download and use Temu, cybersecurity concerns have been raised in the last few weeks about potential malware from Pinduoduo.
It’s yet to be seen if the headline-making concerns about Pinduoduo cast a shadow on Temu or if it captures the attention of Washington, D.C., for new Congressional hearings. Amazon, which is clearing facing competition for consumers’ time from the Temu upstart, just in the last few days proactively put out a warning to its customers on how to defeat scams and warning them to be careful of installing other apps and software. Related? We don’t know but it is a good reminder. Consumers and brands need to be vigilant to be safe in digital.
Temu suddenly became the new hotness thanks to a splashy “Shop Like a Billionaire” commercial during the Super Bowl. Since that U.S. launch, it’s been downloaded and used across the App Store and Google Play 19 million times, with 18 million of those coming from the U.S.—and it’s been around for only less than a year, since September 2022.
That in a nutshell is the new reality that faces every marketer today.
The hottest ad environments are not old-school media, nor even newer-school digital properties. They’re disruptive, emerging online opportunities devoted in innovative ways to “service content”—shopping/commerce, searching, entertainment and doing. Right now, without goods to sell on Temu advertisers might not have much reason to be there, but they have a lot of reason to watch the opportunities in the explosion of the universe of digital service.
Apple is embedding ads in maps and other apps where consumers are actively looking for information as they navigate through their commutes, their local travels, their vacations or just plan their international journeys. Anything you do in Apple Maps is an opportunity to serve an ad.
And that’s also what’s happening on Walmart, Target, Kroger and other retail media plays. Walmart made $2.7 billion on ads in 2022—and that’s entirely new revenue to that business. Uber made $500 million showing ads to passengers and is targeting $1 billion in revenue in the high-margin division by 2024. Amazon has grown its ad business to over $30 billion annually for its retail media offering. Another eye opener? Ad revenue at Amazon overtook Prime revenue in 2022.
Any inventory that targets consumers using first-party data is gold, and when they work, ads have much higher revenue than infrastructure, retail and logistics. Just as search placement has changed, the multiplicity of ways and places where ads sit and how they appear now has changed too.
While some say the traditionally dominant and safe ad environments like Meta and Google are declining, Washington legislators and regulators arrive, again, late to the party and keep their eyes on where the puck was.
And these new ad surfaces work.
Anker, a Chinese accessories company, has built a $2 billion business on the Amazon marketplace with the help of Amazon ads. Chinese smartphone fast-fashion brand Shein has in net sales surpassed Zara and H&M combined and in terms of app downloads has beat them both.
If you’re just thinking about brand building, you’re already losing—of course getting to grasp, define and then know how you will tell your story across these multiple dimensions of digital’s discrete structures and adding them up to a continuous narrative is so much more intense than we once had it. Marketers need to be focused on where the people are and where the first party data is. And above all, they need to be focused on selling. Just use the Shein example as your guide—do in digital media what they do in clothing and you’ll be just fine (as if it were that easy…).
In sum though, any place that is a surface area with first-party data is where consumers are. And that’s where smart brands need to be, too.
So, it might well be time to rethink your media plan, as the old world of digital platforms gets turned around. Again.