Amplifying Off-Site Purchases with On-Site Retail Media Advertising

Retail media is of growing interest to brands, and online retailers offer a large collection of product information that is freely available for consumers’ online and offline purchase decisions. In this study, the authors map webrooming across ten product categories by combining internal data from consumer browsing behavior at an online retailer and survey responses from the same customers about their offsite behavior. Moreover, they build a random forest machine-learning model to predict the magnitude of webrooming across categories. They find that webrooming is economically substantial. On average, for every 10 customers who research the product category on-site and buy on-site, 17 other customers research the product category on-site and buy off-site. As to retail media's impact, upper-funnel and always-on online ad forms are associated with a higher number of online searchers in the laptop category who buy the brand offline. Beyond finding support for their propositions, the authors provide directions for future research on the cross-channel effects of retail media and how they generalize across brands, categories, and retailers.