Operations
29 March 2022
Uber wants to power local commerce
At ShopTalk, CEO Dara Khosrowshahi discussed the vision behind the company's moves to expand delivery beyond food.
(Photo via Uber)
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As it expands delivery options beyond food to retail goods, Uber is planting a flag around the area it wants to win: local commerce.
At ShopTalk on Tuesday, Uber CEO Dara Khosrowshahi said the company is looking to help merchants "out-Amazon Amazon" by providing technology to local merchants that can assist with fulfillment, pricing, routing and other operations that power local delivery of goods. It aims to be the "omnichannel partner for local merchants," he said. Combine that with Uber's delivery network and a user base that allows retailers to reach a large audience, Khosrowshahi said the company believes it can grow the service beyond the size of rivals when it comes to delivering items locally.
During the keynote session, Bloomberg TV's Emily Chang asked how he would characterize the company's ambitions, referencing Shopify CEO Tobi Lütke's famous declaration that his platform was "arming the rebels."
"We're arming the local rebels," Khosrowshahi said.
After moving into delivery with Uber Eats, Amazon expanded the available items beyond food over the last two years. It started delivering essential items in the pandemic, and has added more available items over the last two years. Coming on the heels of the company's Super Bowl ad campaign that showed celebrities tasting Uber Eats-delivered items that weren't food, Khosrowshahi's declaration points to how the company that started with ridesharing sees its role in ecommerce. With the ad campaign, the company is testing whether to keep the Uber Eats name for its delivery division even though it has more, but indications so far are that the Uber Eats brand will remain, Khosrowshahi said.
After all, it's clear that food will still play a big role. When it comes to groceries, Khosrowshahi said that "rapid delivery should be a part of every local grocery player's offerings," adding that the company believes it can be set up in a "capital light way."
The company also made a move toward adding convenience options on Tuesday, as it announced a global partnership with BP that aims to make 3,000 of the company's retail locations available on Uber's delivery platform over the next three years to provide items from the stores. It's about
It comes as delivery of groceries and convenience items is picking up on a variety of platforms. DoorDash and Grubhub are making moves, while goPuff built a business on delivering convenience items. Instacart, Whole Foods and others deliver groceries.
For its part, Uber believes that being able to bring together rides, food and retail items will create a flywheel effect.
"We are going to build that local operating system for every day life," Khosrowshahi said. Logistics technology made available to retailers will be a key component.
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Retail Media
16h
Gopuff moves fast on a new retail media approach: Non-endemic ads
The quick commerce marketplace is partnering with Rokt to expand beyond CPG advertising.
(Photo via Gopuff)
In some ways, retail media campaigns function like promotions in a brick-and-mortar store.
With retail media, brands can reach customers with advertising on the websites where shopping is taking place. This proximity to the point of sale provides an opportunity for brands who are already selling within a marketplace to take advantage of opportunities to elevate their position in search results, and stand out from a crowd of listings. This is the same goal that many brands have when they purchase highly-trafficked space in a store. But instead of checkout aisle and endcap placements, there are now sponsored products in search results.
But that’s not the end of the story.
The fact that retail media is internet-based and powered by first-party data collected at the purchase level is poised to open up new opportunities to reach consumers that go beyond today’s norms.
One such example is the introduction of non-endemic advertising. This allows brands that aren’t directly selling a product within a marketplace to purchase ad space.
Why would a brand want to advertise in a place where they can’t make a direct sale? The thinking goes like this: The marketplaces have the audience, and the data on them that allows for precise targeting. They can be places to learn about a new product, just as much as they can be a place to buy.
One early example of the recognition of the opportunity in non-endemic advertising arrived this month. The quick delivery marketplace Gopuff partnered with ecommerce technology company Rokt to enable brands outside the CPG category to advertise on Gopuff’s app.
Under the hood, the companies are combining machine learning technology from Rokt that is designed to present relevant offers to customers with a Gopuff audience that is made up of Gen Zers and millennials, engaged and curious about trying new brands.
The partnership will enable advertisers to target customer segments by demographic and location. Customers will also receive offers to try new brands, such as Hulu, AdoreMe and Noom.
What sets this advertising approach apart will be the consumer categories where it is focused. Typically, ads on Gopuff are focused around the convenience store items already available on the app. Now, shoppers will see other kinds of products in the mix, and they will click through to checkout pages that are outside Gopuff if they are interested in buying. This also has the potential to change how advertisers approach media spend. It means everyone from a sporting goods brand to a car company can now consider Gopuff as they plan. They must also consider how these channels work together as a whole.
"We are thrilled to partner with Gopuff and enhance its ad business, helping it move beyond the CPG category," said Elizabeth Buchanan, CCO of Rokt, in a statement. "By delivering relevant offers to Gopuff users, Rokt will help Gopuff Ads' brand partners across all categories create more meaningful customer connections and drive incremental sales."
The partnership underscores how retail media networks have three key building blocks for digital advertising: They’re a destination that people visit with an intent to shop, they have the audience that brands want to reach and they have data that can help to reach the right consumers.
It points to how ecommerce marketplaces can not only become the new store, but also emerge as ad networks like Facebook and Google before them. It’s a big reason why retail media networks have exploded over the last year, and why growth is forecast to continue to accelerate.
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