Paul Lynch, SVP Retail & Commerce UK&I at dentsu
There is no doubt that we are in the midst of a retail media gold rush. In recent years it has become one of the fastest growing digital channels, as developments in infrastructure, the pace of innovation and maturing attitudes to data privacy drive brands to seek new revenue streams.
In fact, dentsu’s most recent Global Ad Spend report predicts that retail media will surge by 21.9% this year. It’s unsurprising really – this model is transforming an entire industry, bringing opportunity for both brands and retailers alike.
For retailers, offering advertising space and services across their owned channels brings them into the same league as publishers and television networks. They are able to monetise their assets and unlock entirely new revenue streams. However, that’s really just the tip of the iceberg when it comes to how those operating in the sector can reap the rewards of this growing advertising phenomenon.
The next chapter in connected experiences
In our mobile-first world, consumers no longer ‘go’ shopping. Instead, they are in a continuous state of browsing and selecting the brands that they feel most resonate with their emotions and needs. They are also getting more selective, as economic conditions continue to remain unstable. In fact, according to our recent Consumer Navigator UK edition, more than half of UK consumers (52%) have decreased spend in the past 12 months.
Against this backdrop, it’s more important than ever to deliver seamless unrestricted experiences across every channel and touchpoint. However, creating connected experiences that truly integrate both digital and physical environments and offer a unified customer journey can be challenging, thanks to ever-increasing privacy regulations and the subsequent decline of third-party data.
Luckily, retail media offers a clever alternative by leveraging the first party data that retailers are able to directly collect from their customers. This data is the key to creating more personalised experiences and delivering targeted advertising, aligning products and offers to consumer shopping behaviours.
Through their unique data insights, retail media networks also open the door to real-time engagement opportunities. This enables brands and retailers to work together and adapt campaigns instantly, ensuring that the intended audiences always receive timely and meaningful messages. Similarly, by integrating technologies like digital signage and interactive displays, retail media can help retailers to make the shopping journey more engaging.
Ultimately, retail media is not just about data monetisation. It’s a full-circle moment that can also drive better personalisation and act as a catalyst for improved customer experience, both now and going forward. For example, in the not-so-distant future if a customer searches for a bottle of Malbec online, then visits a supermarket and hovers in the wine aisle looking at alternative options – both times without making a transaction – modern technology will be able to track this. Later, when that same customer is sitting at home watching Netflix, an advert will pop up for some Malbec at a discounted price and they will be more likely to make a purchase because it’s the right product at the right time. Advertising will be more personalised and relevant than ever. But to be at the forefront of this in the future, retailers need to act today.
Collaboration is key
Whilst retail media has certainly got everyone talking, it can be an increasingly complex field to navigate. Many who have ventured into the space have failed to see a return on investment.
Getting retail media right is about far more than simply ‘launching’ a network. Instead, retailers should take a crawl, walk, run and then sprint approach with a test and learn methodology. The importance of having a composable technology stack that can deliver data at every stage of a campaign – from building out the network to measuring the results – should also not be underestimated. With new solutions appearing each day, this is the key to remaining competitive and being able to create tailored content that will resonate with the right audiences at the right time.
From day one, retail media networks should be built with customer experience in mind. It is only then that the results will do the talking and the network will organically be able to grow. This is where collaborating with partners to access and utilise the best tools and expertise on the market can help.
At dentsu, our approach is to work with our clients to understand their maturity level with retail media, review their revenue opportunities and collaborate to develop a business plan for growth. Our New Stream Media solution helps retailers design and implement retail media platforms that enhance customer experiences and drive revenue. Underpinned by rich audience & insight solutions, integrated media planning, analytics & operations it can help retailers to rapidly deploy enhanced retail media networks at speed and at scale.
An opportunity not to be missed
Retail media’s meteoric rise represents a transformative opportunity for retailers. By leveraging first-party data, embracing real-time insights, and integrating innovative technologies, they can create personalised and engaging experiences that resonate with today’s consumers.
However, success in retail media is not a given. Collaboration and the deployment of robust technology stacks will be key to ensuring seamless execution and meaningful results. As the industry continues to evolve, embracing retail media strategically will be key to unlocking its full potential and driving sustainable growth in the future. Watch our recent video series to find out more via this link.
