In the ever-evolving landscape of retail media, three key opportunities stand out as transformative game-changers for brands and retailers. As retailers continue to fortify their media ecosystems and influence, growth will depend on how fast they can unlock new in-store marketing tactics, their efforts to earn valuable first-party data and expand off-site, and their ability to standardize their processes and measurement.
Here’s my take on the top three opportunities retailers must focus on:
In-store revival
As onsite channels intensify, in-store is emerging as an exciting frontier to drive differentiation and conversion for brands and retailers.
Leading brick-and-mortar retailers are focusing on enhancing the shopper experience with the growth of new and engaging in-store experiential marketing offerings. In June, Walmart announced the broadening of its in-store advertising formats by reviving its on-location sampling programs, and using new tactics like “connected” demonstrations that are paired with QR codes to bridge offline and online traffic.
In a recent blog post, Whitney Cooper, head of omnichannel transformation at Walmart Connect, stated “The next frontier of retail media is in-store experiences,” Other retailers known for their sampling programs, such as Costco, Sam’s Club and Trader Joe’s are full steam ahead after a hiatus earlier during the COVID-19 pandemic.
Another trend we are seeing globally is the digitization of in-store media, with major players like Kroger and Tesco rolling out smart screens across their physical locations and using in-store experience providers to advance their targeting capabilities.
While e-commerce continues to reshape consumer habits, in-store still commands larger audiences with trends continuing to show growth. According to the US National Retail Federation, new store openings are outpacing store closures. Digitally native premium brands such as Warby Parker and Athleta, as well as discount retailers such as Dollar General, Five Below and Family Dollar are aggressively growing their physical footprints.
From a marketing budget standpoint, with more than 70% of consumers going in-store, and reports that even the coveted Generation Z loves shopping at physical retail stores “as much” as online, both brands and retailers should lean back into this highly valuable opportunity to deliver targeted, memorable in-person impressions. Retailers re-energizing their in-store footprints will not only offer brands and agencies better media performance, but will attract bigger marketing budgets, and most importantly, drive shopper value.
Off-site audiences
Sophisticated retailers are sitting on a goldmine of powerful insights within their first-party data, which should inform off-site media buys beyond their owned assets and capture the power of new partner channels like programmatic, social, connected TV and digital out of home.
Off-site audiences, informed by first-party data, allow brands, both endemic and non-endemic, to tailor advertising spending to key shopper groups. We are seeing this in action now with key retailers such as electronics powerhouse Best Buy and Albertsons.
CTV also is proving to be a growing and measurable off-site channel, with CTV ad views being attributed to in-store purchases to clearly show campaign ROI. Because of advances in CTV tech, Morgan Stanley analysts, Matthew Cost and Brian Nowak shared that in the past year, CTV has been a “rare area of strength in turbulent online ad markets,” estimating the vertical grew 28% in the last 12 months vs. the overall online ad sector’s 9% growth.
As we are well on the way to a cookieless future, the use of retailers’ consumer data in the broader off-site ecosystem supports a greater opportunity to understand omnichannel shoppers’ motivations and anticipate their needs. It is an effective and scalable tool to help stores and brands reach the right shoppers, in the right moment, with the right message.
However, high-performance audience extension campaigns are only as good as the first-party data that informs them, but when employed correctly, they are poised to become the next big differentiator in the crowded retail media landscape.
Measurement and process standardization
Disparate systems, fragmented processes, inconsistent metric availability and reporting methodologies are the result of retail media accelerating at a rapid pace. Essentially, each retailer has their own set of rules, with a unique set of terminology, metrics and reporting. On top of this, various media channels and third-party players also have unique systems and scoreboards in place.
For brands, this landscape has become the wild, wild west, where they face the challenges of navigating through multiple walled garden networks. Simply put, according to a 2023 Association of National Advertisers study, 82% of CMOs find a lack of standardization across retail media platforms “a challenge” or a “big challenge.”
Measurement, specifically, is the never-ending loop being discussed in the shopper marketing industry. Brands need to know their advertising efforts are driving incremental business and new-to-brand sales, which helps to grow revenue and velocities.
Today, the industry doesn’t yet operate under common standards, nor are there universal best practices regarding measurement and reporting, however, we’re starting to see glimmers of hope, as shown by the recent debut of Albertsons retail media plan that follows the guidelines of the IAB and the IAS’s recent partnership with Criteo.
Whether the objective is awareness or conversion, performance measurement is key and there is a unique opportunity that retailers’ have in the media industry, to more effectively attribute marketing efforts to tangible brand results such as store visitation, product engagement, new to brand, new to category and, ultimately, the coveted checkout.
Retail media is just kicking off. Brands should continue to keep their eyes on the in-store experience as retailers get creative on how they deliver incremental value to their brick-and-mortar shoppers and their advertisers.
Retailers and brands will continue to take every opportunity to safely gather and harness the power of first-party data to drive smart off-site targeting. And effective measurement will continue to drive confidence essential to earn and retain the big marketing budgets that await the future of retail media.
Teresa Aprile, co-founder and general manager of Brandcrush (acquired by Criteo in March 2023), is a global leader in omnichannel retail media software, powering in-store, out-of-store and online media monetization and automation for retailers. Teresa was recognized as a 2023 Top Women in Media Ad Tech by AdExchanger + AdMonsters.
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