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Drizly looks to capitalize on the retail media boom

The news: Uber-owned alcohol delivery service Drizly has launched its own advertising network called Drizly Ads, per The Wall Street Journal.

  • While Drizly already offered display ads on its app and website, Drizly Ads offers a broader array of self-service and custom products including search and display ads, premium brand pages, and sponsored product listings.
  • The launch comes at a time when several retail companies—including Kroger, Best Buy, and Walmart—have taken steps to build out their retail media offerings to grab a larger share of a rapidly growing channel. We expect US digital retail media ad spending will account for 16.4% of total US digital ad spending this year, in a marked jump from 10.0% in 2019.

A unique space: One of the primary drivers behind retail media’s growth are the networks’ unique first-party data sets. That information is all the more valuable given the ongoing deprecation of third-party cookies and mobile identifiers.

  • These data are particularly useful for alcohol brands, which have traditionally spent the majority of their paid media budgets on brand awareness efforts. The networks enable them to shift more money toward targeted direct-response ads.
  • However, Drizly isn't without competitors as both Instacart and DoorDash offer their own retail media networks.

The big takeaway: Given retail media’s growth curve, and Drizly’s unique niche, the company’s new ad network could unlock a significant revenue channel for Uber.

Go further: Read our Retail Media Ad Spending Forecast here.

This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail and marketing industries. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.