Target leans into third-party online marketplace growth

The U.S. Ad Market Tracker rose 2.5% in May -- the first expansion in 11 months. The expansion compares with the year-ago period that was only up modestly and is the best May since Standard Media Index began tracking it. The growth is the first material sign that the U.S. ad marketplace is pulling out of a recession that began in July 2022, based on the SMI data, which is derived from a pool of actual ad spending processed by the major agency holding companies and independent media services agencies.

Consumers exhibited caution with their spending in July. Although there was an increase in sessions for many retailers, this did not translate into higher sales, with order volumes remaining flat. Overall, U.S. retail sales grew modestly by 0.74% month-over-month, indicating that while consumers continue to spend, they are doing so carefully. The July jobs report from the Bureau of Labor Statistics also painted a mixed picture of the U.S. labor market, further highlighting consumer restraint in discretionary spending. Apparel and Outdoor brands outperformed many Home and Specialty retailers, buoyed by the back-to-school season and the Olympics, respectively. Nevertheless, demand appears constrained across verticals. In this challenging environment, refining strategies to enhance customer conversion rates and focus on improving customer lifetime value (LTV) will be crucial.

Google confirmed Thursday to MediaPost that it ran a limited experiment with a handful of publishers serving ads in chatbots before making AdSense for Search (AFS) broadly available to sites that host conversational AI interfaces earlier this year. AFS has been a long-standing product that allows publishers to show ads on relevant queries within the search results on a publisher’s page. The AdSense network was traditionally used to place ads in search results and across websites. Now it is running ads in chatbot interactions.