Retail media is a $1 billion industry that David Jones has just begun drilling into this year. Learn what else is trending in 2024 in Ragtrader's free Australian Fashion Forecast 2024.
Over a Zoom call in hotel quarantine in mid-2021, James Holloman floated the words “retail media” with his fellow finance and marketing colleagues at David Jones. Having just come into the role then, Holloman was keen to flesh out this new idea.
He says retail media is the new business trend post-COVID, with many calling it the third wave of digital advertising - following search in the early 2000s, and socials later in the decade.
In fact, retail media is estimated to be worth around $1 billion according to PwC, with the figure set to triple by 2026. Amazon Australia grew its Australian advertising business to over $100 million during 2022, according to ASIC filings.
“It's been a trend for some time,” Holloman said, “particularly looking into the future where we're facing a cookieless world. Having first-party data and understanding your core customers, and the audiences that people are trying to communicate to is critical. And it's really retailers that are sitting on the biggest pool of first-party data, who can actually use that to understand that final attribution - that final sale.”
From that initial discussion, Holloman linked up with CEO Scott Fyfe and the rest of the executive leadership team to commence the process of mapping its core media assets. That’s everything from the Jones magazine through to all its instore digital screens, and even understanding its first-party data and how the department store could leverage that across its website and social channels.
That’s 30,000 assets according to Holloman.
Following the documentation of all its assets, David Jones uploaded that to a cloud-based system, which then enables the national retailer to manage all its scheduling and booking.
“We then involved Sonder, who did a full external evaluation on all of our media assets, so we were really fair and equitable to the media landscape. And then we started to engage some of our brands, which we've been doing over the past couple of months.”
Prior to its launch, Holloman says David Jones Amplify had over 1,000 brands buying into it already – all endemic to David Jones across its key departments including fashion, beauty and homewares. But, this is easier said than done according to Holloman.
Over the last two and a bit years, Holloman had to navigate the typical challenges around shifting management ideals and bringing the rest of the David Jones internal team onto the same page, alongside the full mapping of its media assets - including some channels that the retailer has never opened to other brands before.
“We have 5.4 million active customers that have shopped with us last year,” Holloman confirms. “So there will be the ability to communicate to those customers. We have 55 million customers that came into our physical stores last year. And 110 million customers came to our website last year. So the audience potential is huge.
“And all of those audiences are premium shoppers.”
Moreover, David Jones has “slightly reshaped” the marketing arm, with some of Holloman’s colleagues taking on Amplify tasks. Amplify will be headed up by Melissa Polglase, who will report to Holloman, with the department currently recruiting a couple of media sales managers and some coordinators to help with scheduling.
“We are leveraging the support of the greater marketing organisation. It will be operated as a separate division of David Jones with its own separate profit and loss.”
According to Holloman, the key selling point here is how targeted its retail media arm can be as opposed to general styles of marketing. When signing on new brands, he says the team can sit down with the interested brand and dig into what its key aim is - whether its increasing customer base, basket sizes, new product launches, or brand repositioning.
Holloman says its core market will be brands that are endemic to David Jones – meaning those connected already with the company – as opposed to nonendemic. However, Amplify is already attracting non-endemic players, including Tourism Western Australia.
“They have shown interest in displaying their communications to some of our core audiences on the East Coast, to inspire them to travel to WA. We really feel like that's a great triple-win - it’s great for David Jones, great for the brand partner who is advertising, and great for our customers.”
Other non-endemic brands include a few cruise ship liners, alongside premium and luxury automotive businesses. Looking ahead, Holloman says it is only up from here. He says the ability to advertise without wasting money is fast-becoming important to marketing teams.
“From what I can see across the whole landscape, retail media does seem to be a channel that many advertisers - from FMCG right through to luxury - really want to tap into. Because it's now probably one of the most effective media channels.”
Read what else is trending in 2024 in Ragtrader's free Australian Fashion Forecast 2024.