Click to View Your Cart: The Big Business of Shopping and Retail Across Digital Advertising & Mobile Apps

We’re the same, you and I – the consumer and the advertiser. Just as a savvy consumer weighs how to best spend their money on the products and goods, shopping and retail brands wage a similar battle on how to effectively spend their budgets to buy, well, the consumer – in the form of trust and loyalty. And if the brand is doing its job correctly, each of them will find what they’re looking for. 

Using our market-leading mobile app, advertising, and audience insights, we dove into the shopping categories and subcategories for 2024 YTD, analyzing how the best retailers are advertising to their target audiences, their channel strategies, creative messaging, and ultimately app downloads. 

The Top Shops: Shopping Brands

Comparing the top five brands in the Shopping category by ad spend in the United States, Shop Amazon ranks #1 year-to-date, earning a 33% spend share, followed by Temu which grabbed 24% spend share. However, while Amazon, Walmart, and Temu’s ad spend translated into matching impression volume, Shein Group and Chewy saw drops of -4% and -3% respectively. This suggests that Shein Group and Chewy are either being less efficient with their ad spend or being more selective in getting their ad placements in front of a higher value audience.

Channel strategy for each brand shows heavy investment in Facebook for both Temu and Shein, with 58% and 54% respectively, as Amazon leaned into Pinterest with 35% of its digital budget. And while Instagram spread fairly evenly across each brand, ranging from 17% to 26%, Chewy invested 17% of spend in both TikTok and OTT, higher than any of the top five, perhaps trying to lean into a younger demographic.

However, Shein’s investment in YouTube doesn’t appear to have paid off, with the channel seeing the largest disparity between ad spend and impression share – 14% spend vs. 7% impression share. Shein’s strategy for Instagram and Facebook appears to be more effective as both channels recorded a higher ratio of impression share to spend.

Sub-Category Spotlight

Paper or Plastic - Grocery Stores

Digging deeper into the shopping category, grocery stores might be one of the most competitive sub-categories. We all have to eat, right? But what makes us choose one store over another? A 2024 Statista poll found that store environment was the top factor for people when choosing a grocery store with 74% ranking it as “very important,” with product variety taking second at 70%. Price, discount, promotions came in fourth with 63% of respondents ranking it very important.

So, who is listening to their customers? Of the top 10 grocery advertisers, all of them served ads promoting some type of price savings, promotion, or discount. However, Publix stands out with a creative strategy that seems to be taking customer feelings and store environment into account, with YouTube and OTT video ads portraying Mother’s Day, a wedding, and the feeling of shopping at the store, with the taglines: “Celebrate the moments that bring us closer,” and “Where shopping is a pleasure.”

Your Order is Being Processed: Mobile Insights

When we’re not shopping off the rack and in person, mobile apps are the next best thing – minus the dressing room. Taking a look at the top shopping apps, by downloads in the United States, Temu takes the top spot with over 20 million downloads in Q1. The Chinese e-commerce app launched in late 2022 and has surpassed long-established rivals like Shein and Amazon each of the past six quarters.

However, the shopping app doesn’t even register in the top 25 when looking at growth, having dropped -29% since Q4, 2023 in the US., suggesting it may have reached saturation. Temu’s 20 million downloads, while nearly double that of its closest competitor, have trended down since their peak at nearly 36 million in Q2 2023. Shein jumps to number one as the top ranked app by growth, gaining more than 830k app downloads in Q1 vs. the prior quarter (+8% quarter-over-quarter). This is all the more impressive considering that this growth is following the holiday shopping season in the US when demand typically peaks for most apps.

But, what good are downloads if your users aren’t actively spending time in your app? When analyzing US Daily Active Users (DAU), Temu drops to 2nd place behind Amazon, with Amazon recording more than 20 million average DAU in the quarter. Temu’s push to add new users is paying off – its average US DAU has climbed more than 150% over the past year and it surpassed apps including eBay, OfferUp, Shein, and Walmart over this period.

Where Are Your People? Audience Insights

With our advertising and app insights allowing transparency into ad spend and app engagement, Sensor Tower’s  Audience Insights flips the coin, focusing on the audience and app user. Where does an audience see ads? What apps do they open most frequently? And what are their demographics? Let’s find out.

Shopaholics Persona

Shopaholics unite! Sensor Tower’s Audience Insights considers a Shopaholic to be people who frequently open online retail shopping apps. So, who is a shopaholic? 65% are female to 35% male, with 32.1% in the 25-34 age demographic, and a nearly identical 31.7% for 35-44 year olds.  What apps do Shopaholics open most frequently? Amazon Shopper Panel leads the list in share of audience, with +1,180% who open this app more than the general population of smartphone users, with USPS Mobile (+1,080%) in second, and Zip - Buy Now Pay Later app (+1,070%) in third.

As a brand, you need to know where your audience is being exposed to ads. Through Q1 2024, Shopaholics saw ads 37.1% of the time on Facebook, 19.2% on Instagram and 15.3% on Pinterest, with 11.6% on YouTube and 6.2% on TikTok. Similarly, which top advertisers does this persona group see more than the general population? BuzzFeed tops the list, as Shopaholics are exposed to ads from the media publisher +495% more than the general population of smartphone users.

Perhaps you, as an advertiser, are confident you’re marketing in the proper channels to reach the Shopaholics? But, what about the personas this group is related to? Have you considered those ancillary audiences as well, and where those alternate personas are seeing ads? You could be missing an entire segment of your target audience. Shopaholics, for example, also identify as Fashionistas, opening fashion apps 1,680% more than the general population – not much of a surprise – but they also closely identify in the Home Cooks persona (+1,050%).

Digging into the Home Cooks persona, we find the top apps opened by this group cross significantly with our Advertising Insights data on the Grocery Store sub-category, as eight of the top ten are grocery apps including: Sprouts Farmers Market, Thrive Market, H-E-B, Walmart, and Aldi USA. What does this mean? The target audience for these grocery brands extends to the Shopaholic persona, allowing those brands a new avenue to consider for their advertising budgets. 

CHECKOUT - Key Takeaways

As shopping brands continue to wage that internal and external battle to put food on our plates and clothes on our backs, what are the key points should these advertisers keep in mind with their digital and mobile app strategies?

• Understand what customers find most important and adapt your creative messaging

• Higher ad spend doesn’t always translate to higher impressions. If investing in a certain channel isn’t producing an equal or increased share of impressions, those eyeballs are going somewhere else. Knowing where your competitors are advertising and how your impression share stacks up, can put your marketing budget to better use.

• Your app downloads are only one snapshot in the larger picture. How your apps are growing and how long users are spending in the apps, shows if your products, and marketing is keeping your users’ attention and loyalty.

• Target the audiences you know, and identify new audiences you weren’t aware of. Our audience insights data broadens the scope of how advertisers think of their audience, and who are would-be customers. A shopaholic is opening apps for fast food, neobanks and home cooking apps. Meet your audience where they are, and what channels they’re in. No more guessing.

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