Commerce media implications: The convergence of first-party online retailers and marketplace models

Summary

Online retailers and marketplaces are experiencing a convergence between traditional first-party (1P) and marketplace business models. Marketplaces like GrabMart, Delivery Hero, and DoorDash are adopting 1P models for quick commerce, taking on inventory risks to offer fast delivery. Conversely, retailers like Home Depot, Macy's, Walmart, and Nordstrom are transforming into marketplaces, allowing third-party sellers to offer products without inventory management.

This convergence has implications for advertising businesses. As 1P retailers enter marketplace models, they must cater to long-tail sellers with less advertising experience, requiring adjusted commerce media features and strategies. As marketplaces adopt 1P models, they serve sophisticated advertisers needing agency partnerships and deeper reporting.

Commerce media platforms must support unique needs of both models, providing tailored solutions for businesses and advertisers to thrive in this evolving landscape.