At a time when over half of retail media network advertisers are reallocating their budgets to retail media networks, there’s never been a more exciting time to be involved in retail media.
The Interactive Advertising Bureau (IAB) on Sept. 13 held its inaugural Connected Commerce Summit: Retail Reimagined in New York City. The Threefold team joined its industry peers at the summit, which honed in on the biggest challenges and opportunities facing every side of the retail media equation.
From increased standards and transparency to the next frontier, here are our key takeaways:
More uniform standards are a must — and on the horizon
The theme that ran throughout nearly every discussion at the inaugural Connected Commerce Summit was the need for standardization across the retail media landscape. As Retail Media booms, increased standardization and cooperation in measurement and data reporting is key to enable sustainable growth and ensure retailers, brands and consumers get the most from retail media.
To coincide with the summit, the IAB published the Retail Media Measurement Guidelines, developed in collaboration with the IAB Retail Media Measurement Working Group and the Media Rating Council (MRC). Through October 13, the IAB is soliciting public feedback on the proposed standards, which cover aspects including audience measurement, in-store digital placed-based measurements, ad delivery, viewability, incrementality, reporting and transparency.
Major players in the retail media industry had a hand in crafting these proposed standards, including Kroger, Albertsons and Best Buy. Major brands had a seat at the table too, including Coca-Cola, General Mills and Unilever.
“When you think about standards, the hope and sort of desire that I think that we have is it'll increase transparency and it'll help brands and the clients that we partner with to be able to invest their money,” said Claire Wyatt, VP of business strategy and marketing science at Albertsons Media Collective. “Where is it actually going to drive sales? And then because we'll be able to prove that out and make that experience more seamless, it'll be easier to invest with us just as a whole.”
At Threefold, we understand that when everything is measured differently, it’s impossible for brands to know how to compare advertising performance between channels or across networks. That’s why the retail media networks we build, run and operate are powered by Plan-Apps. Plan-Apps’ was developed under the view of standardizing measurement. Everything we measure across our entire portfolio is underpinned by the same methodology, so not only do brands know exactly what the data they’re getting means, they can also make robust comparisons between networks. They’re finally able to compare apples with apples.
Retail media isn’t a tax on brands
In fact, Jill Dvorak, chief content officer at CommerceNext, said calling retail media an “expensive tax” is the biggest misconception about the industry. As the retail media landscape continues to evolve, brands are likely to feel less and less like investing in retail media is tax to do business with a retailer. As retail media networks become more sophisticated, and as retailers are able to provide better and more transparent data to brands, brands will more clearly see the benefits of their investments in retail media. Squashing this myth relies on increased standardization, better data and greater transparency.
For Threefold, ensuring the value of retail media networks is clear and communicated to both retailers and brands is paramount. That’s because if investments in a retailer’s media network are seen as a requirement to do business, the networks simply will not grow. Retailers must shift perception through varied strategies, including by providing collaborative marketing opportunities, offering an in-house agency service and providing sophisticated targeting capabilities through relevant first-party data.
“No doubt 10 years ago, it was a tax because there wasn’t great data,” said Chris Bruderle, vice president of industry insights and content strategy at IAB. "It wasn’t transparent. With what you were getting for the money, the measurement was almost non-existent. So in that case, it’s definitely a tax. I think the sentiment has started to quiet down.”
The store is the new frontier for US retail media
As retail media continues to evolve globally, one area where marketers can expect to focus more is with in-store campaigns. With the majority of consumers shopping in stores, the physical store is ripe for innovation.
But it’s more than just about the store, it’s about creating seamless omnichannel experiences for retailers, brands, and ultimately, consumers. Matt Drzewicki, VP of Partner Solutions Group at Roundel, during a panel discussion shared that 75% of Target shoppers use its mobile app while shopping in store — that number jumps to 90% for Gen Z shoppers.
“That’s the opportunity,” said Drzewicki. “We can talk about different media tactics within the store, but if we don’t think about a true omnichannel media experience, we’re missing out on the huge opportunity.”
This is second nature for Threefold. In the UK, where we’ve operated and optimised 10 retail media networks over the past 15 years, retailers have largely focused on in-store retail media, including traditional points of sale, screens and audio.
“Retail media networks that get it right for their CPG advertisers are those who drive footfall in-store via offsite channels; capture online shoppers with creative, targeted solutions that leverage the retailers’ first-party data; and then connect the dots to bring the shopping experience to life in-store with a solid retargeting program in place to capture any lapsed or missed opportunity,” said Sean Crawford, managing director of Threefold North America.
Data is paramount
Retailers have access to numerous data points about their shoppers, and retail media enables brands to have a piece of the pie. In addition to data from in-store behavior, retailers also collect data through loyalty programs, e-commerce platforms and mobile apps.
Especially as the tech industry moves away from cookies, tools advertisers and marketers have long relied on to learn about consumers, first-party data from retailers will only become more important. It’s clear that retailers and their media networks that are transparent with data — while also being sensitive to consumer privacy — will establish the most fruitful relationship with their CPG partners. Retail Media Networks must be transparent in their use of first-party data and how they measure return on investment (ROI) to unlock incremental ad dollars.
“Providing ROI reporting on retail media investment is essential for retailers that want to build lasting relationships with brands and continue to grow their retail media revenue,” said Leanne Naughton, SMG business director, in a recent Threefold blog post. “By demonstrating transparency and accountability, providing clear insights into campaign performance, and identifying opportunities for improvement, retailers can deliver better results for brands and establish themselves as leaders in the retail media space.”