US retail giant Costco has joined rivals Target and Walmart with the roll out of its own retail media network, under the Mark Williamson, who is now AVP of retail media at the company.
Currently in beta testing, the network will be based on the loyalty data from the retailers 74.5 million members and will leverage their past purchase history. Ads will be served both on and off network.
Costco is the third-largest retailer in the world, the world’s largest retailer of beef, organic foods, rotisserie chicken, and wine. Costco operates a club warehouse model which means shoppers have to use membership cards to shop and, as a result, they have a ton of shopping habits and past purchases to power to draw on. Costco can map individual purchases to shoppers’ households, both in-store and on their ecommerce site.
Retail behemoth that is the retail media laggard
However, it has waiting till now to launch its own Retail Media network, says retail media expert Colin Lewis. In fact, the company is still only in beta testing mode. The business brings in revenue through its magazine and basic on-site contextual ads, but that’s it. According to analysts, this business is worth around $225m a year to Costco, small fry compared to the $60bn of revenue the company has.
However, given that the CEO of Costco, Ron Vachris mentioned Retail Media on a recent earnings call, saying “Costco has a significant program now with retail media, and we see some great upside potential,” perhaps the retailer will start to make up lost ground.
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