Retail media is becoming an increasingly important profit centre for retailers. With e-commerce sales an increasing proportion of total sales across retail estates, many retailers today are reviewing retail media strategies and setting targets for ambitious revenue growth to boost overall profitability.
Having worked with retailers for over a decade, it's clear transparent performance reporting is essential to deliver true incrementality. In this short blog, I’ll outline why:
Change perceptions and build trust: The availability of media performance reporting shows brands retailers are committed to transparency and accountability and helps shift any perception that investment is a trading tax. Until retail media is seen as attractive marketing opportunity in its own right, retailers won’t attract a share of overall marketing budgets, limiting investment to trading allocations. To maximise the retail media revenue opportunity, retailers need to encourage growth of the overall share of marketing investment as well as attract a growing proportion of this investment from across the market. By providing detailed ROI reporting, retailers can build trust with brands and establish long-term partnerships.
Aligns with industry standards: Providing ROI reporting is becoming an industry standard for retailers that offer retail media services. Brands expect to see clear and transparent reporting on their campaigns, and retailers that fail to provide this information may struggle to attract and retain advertising investment. In a world where marketing budgets are managed an in increasingly consolidated way by aligning with industry standards, retailers can demonstrate their commitment to best practices and position themselves as leaders in the retail media space.
Deliver sustainable revenue growth: ROI reporting is essential to demonstrating the value of retail media to brands. By providing clear and measurable results, retailers can show brands how their advertising campaigns are driving sales, increasing brand awareness, and delivering other key performance indicators. This can help to secure more advertising investment and grow retail media revenue over time.
Enables better decision-making: ROI reporting provides brands with valuable insights into the performance of their advertising campaigns. By analysing this data, brands can make informed decisions about how to optimise campaigns, adjust their targeting strategies, and allocate resources more effectively. This can help to drive better results and increase overall investment in time.
Helps to identify areas for improvement: By tracking ROI over time, retailers can identify how their media assets are performing. This can help to uncover opportunities for improvement, such as adjustments to media charges. By continuously monitoring ROI, retailers can identify areas for improvement and optimise their estate.
In conclusion, 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. 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. Retailers that fail to provide ROI reporting may struggle to attract and retain advertising investment against competitors and may miss out on the significant revenue opportunities presented by retail media.