Retail Platform Advertising - NAFTA

In NAFTA, ad spending in the Retail Platform Advertising market market is projected to reach US$61.93bn in 2024.
Ad spending in this region is expected to demonstrate an annual growth rate (CAGR 2024-2030) of 15.59%, which will result in a projected market volume of US$147.80bn by 2030.
The average ad spending per user in the Retail Platform Advertising market market within NAFTA is projected to amount to US$166.20 in 2024.
In a global context, most ad spending will be generated the United States, which is expected to account for US$57.63bn in 2024.
In the United States, Retail Platform Advertising is increasingly leveraging advanced data analytics to create personalized consumer experiences and enhance engagement effectiveness.

Definition:

Retail platform advertising (RPA) refers to digital ads displayed on websites and apps dedicated to retail platforms, such as Amazon, Walmart, eBay, Alibaba, and JD.com. This includes all types of advertising across various devices, e.g., PCs, smartphones, and tablets, and covers formats such as sponsored products, banners, and videos. RPA specifically excludes offline retail ads (e.g., in-store displays and billboards), off-site ads (e.g., ads appearing on non-retail websites or apps), ads on social media platforms (e.g., Facebook or Instagram), and ads on search engines (e.g., Google or Bing).

Additional Information:

It is important not to confuse RPA with retail media networks (RMNs). RMNs involve digital ads that are also displayed on retail e-commerce sites or apps, but these ads are purchased through a retailer’s media network or a demand-side platform (DSP). While RMNs include ads on sites such as Amazon and Walmart, they also cover ads bought through networks such as Amazon DSP, Walmart Connect, and Etsy’s Offsite Ads, and these ads may not necessarily appear directly on the retailer’s e-commerce site or app. Unlike RPA, RMNs represent a broader approach that encompasses a range of ad placements, both on and off the retailer’s own platforms.

Digital ads displayed on websites and apps dedicated to retail platforms
All types of advertising across various devices, e.g., PCs, smartphones, and tablets
All types of sponsored ad formats, such as sponsored products, banners, and videos

Offline retail ads (e.g., in-store displays and billboards)
Off-site ads (e.g., ads appearing on non-retail websites or apps)
Ads on social media platforms (e.g., Facebook or Instagram)
Ads on search engines (e.g., Google or Bing)

The Retail Platform Advertising Market in NAFTA has been witnessing steady growth, influenced by factors such as the increasing shift towards e-commerce, enhanced targeting capabilities, and the growing demand for personalized advertising solutions among consumers.

Customer preferences: Consumers in the NAFTA region are increasingly favoring personalized shopping experiences, driving a surge in demand for targeted retail platform advertising. This trend is shaped by cultural nuances that prioritize convenience and immediate gratification, especially among younger demographics. Additionally, as lifestyle factors evolve, consumers are gravitating towards brands that resonate with their values, such as sustainability and social responsibility. The integration of augmented reality in advertising also enhances engagement, allowing consumers to visualize products in their own environments before making purchases.

Trends in the market: In the NAFTA region, the Retail Platform Advertising Market is experiencing a significant shift towards hyper-targeted advertising strategies that leverage consumer data for personalization. As mobile shopping continues to rise, brands are increasingly investing in data analytics to tailor their messages and optimize consumer engagement. Moreover, social media platforms are integrating shopping features, creating seamless ad experiences that resonate with users. The emphasis on sustainability and ethical practices is also influencing brand narratives, prompting companies to align their advertising strategies with socially responsible values. This evolution is pivotal for industry stakeholders, as adapting to these consumer preferences is crucial for maintaining competitive advantage.

Local special circumstances: In Canada, the Retail Platform Advertising Market is shaped by its bilingual landscape, necessitating tailored advertising strategies that resonate with both English and French-speaking consumers. The influence of Indigenous cultures is also significant, prompting brands to incorporate diverse narratives that reflect local values. Meanwhile, in Mexico, the rapid growth of e-commerce is fueled by a young, tech-savvy population eager for online shopping experiences. Additionally, regulatory frameworks promoting consumer privacy are compelling advertisers to adopt transparent data practices, impacting campaign effectiveness and consumer trust.

Underlying macroeconomic factors: The Retail Platform Advertising Market in North America is significantly influenced by macroeconomic factors such as changing consumer behaviors, economic growth rates, and advancements in technology. In Canada, steady GDP growth and favorable employment rates are fostering consumer confidence, leading to increased spending on retail platforms. Conversely, in Mexico, a burgeoning middle class and heightened mobile penetration are driving e-commerce growth, prompting advertisers to innovate. Additionally, fiscal policies aimed at boosting digital economies are encouraging investment in advertising technologies, while global economic trends, such as supply chain disruptions, affect inventory costs and advertising strategies, necessitating agile marketing approaches.

Data coverage:

Data encompasses enterprises (B2B). Figures are based on Retail platform ad spending and exclude agency commissions, rebates, production costs, and taxes. The market covers advertising by businesses for digital advertisements.

Modeling approach:

Market sizes are determined by a combined top-down and bottom-up approach, based on a specific rationale for each market. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and industry associations, third-party reports, and survey results from our primary research (e.g., Consumer Insights). Next, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and digital consumer spending. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function is well suited to forecast digital products due to the non-linear growth of technology adoption, whereas exponential trend smoothing (ETS) is more suited for projecting steady growth in traditional advertising markets.

Additional notes:

Data is modeled using current exchange rates. The impacts of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice per year. In some cases, the data is updated on an ad-hoc basis (e.g., when new relevant data has been released or significant changes within the market have an impact on the projected development).

This report presents a comprehensive analysis and additional information on the Advertising & Media market, in a PDF format.