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Presence on the Digital Shelf - The most important marketing investment

Bobby Figueroa

Presence on the Digital Shelf - The most important marketing investment

Every marketer knows that in order to generate sales, you need to have product in the store. At traditional retail stores, that means negotiating product presence on the shelf – visibility to shoppers as they prepare to make a purchase, also known as the point of sale.

As more and more transactions take place online, merchants need to take a different approach to drive sales on the digital shelf. The basic concept hasn’t changed, but the strategy and mechanics of digital marketing take some extra work – and offer some extra reward.

For starters, the digital shelf is massive in size. While it’s true that eCommerce only accounts for 10 percent of total U.S. retail sales, the digital shelf has no size limit. So, while a supermarket might carry 45,000 items, Amazon’s U.S. store offers more than 600 million products. To put that in perspective, let’s say each of those products was the size of a medium cereal box. If you lined them up end-to-end, you can build a 20 story high shelf on both sides of the highway as you drive from San Francisco to New York.

Digital shelf gets bigger every day

In the fourth quarter of 2018, U.S.eCommerce sales reached $132.9 billion, rising 12 percent from a year earlier – four times as fast as total U.S. retail sales. The digital shelf is getting bigger – and more crowded – all the time. The opportunity is enormous, for brands and merchants that are ready for it.

The good news is that your products can get instant presence on the digital shelf. Literally, anyone can sell goods to anyone else on the planet with an internet connection. And the digital shelf makes it easier for customers to find what they’re looking for. Many shoppers use their mobile devices to peruse the digital shelf even when they’re in a physical store. A smartphone extends the shelf from a shopper’s home to the beach, or to the bus ride to work in the morning.

So, your product is always available on the digital shelf.  You can point shoppers to your brand page or product page. And the content on those pages needs to be as crisp and engaging as ever.

Not as easy as it looks

But getting the digital shelf right can be complicated, with a ton of customer data to analyze and lots of variables to manage. How do you position your goods among the millions of other available products? How can a brand control its fate on the digital shelf, making sure it shows up to the right customers, at the right time to drive click-through and purchase? Hint: you can’t just trust the channel to be the expert for your products. Brands need to embrace the digital shelf and own it for themselves.

Point of sale marketing is the most effective form of marketing because it drives sales. In the U.S. alone, brands spend hundreds of billions of dollars each year on point of sale marketing. But until now, most of that money has gone into physical stores, not digital. That’s a missed opportunity. As eCommerce continues to grow, point of sale can accomplish much more in a digital world, where incredibly rich purchase signals can help reach, activate and convert customers into dedicated buyers and brand loyalists.  

However, no human could analyze the millions of available data points in order to produce the actionable insights that digital point of sale can deliver. It takes algorithms to account for every aspect of the brand and its competitors on Amazon. It takes artificial intelligence to communicate with the channel. It takes machine learning to continuously adapt and optimize for efficiencies and increased sales as the data ages. The digital shelf is constantly evolving. And all of that takes very advanced computer power.

The technology is ready

Fortunately, we have entered an era where advancements in technology can help us aggregate all of this expertise into a platform that can think, that we can train on our brands on the channel, and that we can rely on to make the decisions for the ongoing management of every single shelf position out there.

Increasingly easier-to-use machine learning capabilities now enable anyone to create new and differentiated online retail experiences. Customers can use computer-generated catalogs and augmented reality to envision products in their homes. Brands can extract qualitative feedback from large volumes of reviews and surveys to refine their positioning and offerings. Merchants can decide, with surgical precision, when and where to place their products in front of the customer to achieve their sales goals.  

By embracing the digital shelf, brands can own it for their own products and take control of when shopper see them. With the support of machine learning, platforms like Gradient enable products to be discovered and purchased more frequently by shoppers.  

The physical retail world has shown us the value of point of sale marketing. Its track record of driving sales is impossible to ignore. Now it’s time to put that knowledge to work with cutting edge technologies that will drive eCommerce to new heights in the years to come.

It’s my belief that Gradient – the company I lead – will be one of the key players to simplify the way we talk about and use machine learning in the retail and eCommerce environments.  It’s what we do every day.

By combining millions of data points, from pricing to product pages, ad formats to keywords and rankings, our platform gathers the data necessary to learn how to make a difference.

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