For many brands and retailers, the focus is on activation, ad-ops and getting campaigns out the door rather than creating a brief, defining objectives and defining what success is, says Colin Lewis.
Many retail media networks focus on selling individual ad formats rather than selling marketing campaigns that are tied to brand objectives, 1st party data, and planned to work across full funnel – onsite, offsite and in-store.
This creates a multitude of downstream problems for brands and retailers alike.
The first is that the campaigns are just marketing campaigns with a different name – with no real use of 1st party data. As Josh Clarkson, global lead retail media, Mars says: “A lot of what I see in Retail media today is just brand marketing or shopper/customer marketing with a different name (and price tag). What sets Retail media apart is the ability to leverage shopper data for audience segmentation and targeting, and it’s not always clear how or where that is actually being utilised. “
The second problem is that the focus is on activation and ad-ops – the ‘what’ or the ‘how’ – but a lot less focus on the ‘why’.
And the question ‘why’ – as in ‘why are we doing this campaign’ is important as the primary budget holders and influencers of marketing programmes such as marketing managers or advertising agencies are within their rights to ask ‘why should I buy retail media instead of any other non-retail media that can deliver the same or better outcomes, stronger measurement, or something already included in my MMM?’
If they are not thinking this, then marketers are not doing their job properly.
The current model won’t capture brand budgets
The third problem with this focus on selling formats and activations, rather than creating campaigns tied in with marketing strategy is a much more fundamental problem.
Inside almost every retail media network, the same question keeps coming up: how do we capture more brand budget?
This is one of the reasons many retail media networks were created in the first place: not simply to sell ad products, but to win the budget that currently goes into TV, radio, outdoor and other media channels.
However, the ambition of capturing brand budgets comes with much tougher questions:
- Most brands have brand growth models, and the central ambition of those models is usually penetration: reaching new buyers. Retail media has not yet proven, consistently enough, that it can deliver against that goal. If retail media wants to compete with established media channels, it has to prove that it can deliver against brand objectives, not just retail media metrics.
- There is a lot of talk about shifting budgets, but budgets aren’t infinite. Budgets do not magically stretch because retail media is growing. In inflationary times, they often shrink. Brands are not suddenly increasing their media budgets by 150% just because retail media has become more important.
Joined-up retail media planning
Media planning has not been a priority for the first phase of retail media growth for lots of good reasons. Going from startup to scaleup is hard at the best of times, and choices and priorities are not always perfect.
But, if we believe that retail media can drive both immediate conversion and long-term category growth, the challenge for retail media networks is to develop a more unified approach to brand planning.
Without proper objectives and briefs, without a joined-up approach, retail media networks are trapped in the short term and cannot set ourselves up for the long term.
However, if advertisers want retail media to deliver business outcomes that matter to them, the emphasis will need to shift toward joined-up Retail media planning, where retail media is integrated into the overall media planning process.
Example of joined-up retail media planning
Pete Robins, founder, Project 5, highlights the example of digital screen options linked to a retailer, which include:
- near-store screens
- at-store placements
- in-store displays
- in-aisle digital panels
As each is a fixed location with a variable audience, Robins says that the logical questions to be asked are around which ad impression matters most and when? Is it the one before the store, the one at the entrance, or the one right at the shelf? Or some weighted mix? How does that differ by category, store cluster, or shopper behaviour?
The future: unified retail media planning
The future of retail media will require brands, agencies and retail media networks to link retail media with other media, for the simple reason that no media works in isolation.
A more unified approach to media planning, with retail media embedded in it, will be better for brands, agencies and retail media networks for three reasons:
- If retail media is included in all media options, its role will be clearer in terms of driving results, and, as a result, demand for retail media will increase.
- Retail media will no longer be judged or bought in isolation, instead it will be judged by the (terrific) job it can do.
- For brand advertisers with bigger budgets who have been reluctant to put retail media into a substantial part of their (non-search) media planning, the role of onsite, offsite and in-store becomes better defined.
To capture brand budget, retail media networks will have to better integrate into the BAU of marketing and advertising workflows.
If joined-up planning becomes standard practice, retail media’s role will be better defined and better exploited and the accusations levelled against it might evaporate.
