The US Retail Industry H2 2016 Update: Digital Ad Spending Forecast and Trends

Executive Summary

US retail industry advertisers will spend $15.81 billion on digital advertising in 2016, a 20.0% gain from 2015 that will see this sector account for 21.9% of total US digital ad spending for the year.

• Walmart, the country’s largest retailer, has made expanding its ecommerce offerings a priority. Its $3.3 billion acquisition of consumer products retailer Jet.com in August was a huge step forward in this effort. In addition, a focus on marketing “Walmart.com more aggressively” is planned, the retailer’s CFO, Brett Biggs, told The Wall Street Journal in October.
• Facebook is boosting its social commerce capabilities. In September 2016 the social network unveiled a new ad type, Dynamic Ads for Retail, that are designed to not only target consumers on Facebook likely to be interested in a particular product, but to ensure that the product would actually be in stock at a brick-and-mortar location near the intended buyer. According to Adweek, the ads, initially tested by retailers including Macy’s, Target and Pottery Barn, would be rolled out to other retailers in time for this year’s holiday shopping season.
• Another indication that more retailer ad dollars could be funneled to social media: Retailers are experimenting with Snapchat’s Snap Ads API. Nordstrom used the Snap Ads API for four ad campaigns in the third quarter, including a video campaign for a Beyoncé-sponsored activewear line. According to a report in Adweek, the retailer was “excited” with how well the ads were received by customers, and planned to continue the partnership.