Retail media networks (RMNs) are a fast-growing space in advertising — up 16.3% last year. Retailers are adding channels and providing better measurement and execution for advertisers. And agencies are answering their clients’ calls to include RMNs in the mix.
While brands are increasing their spend, there are still growing pains around the lack of standardization. Without the ability to compare apples to apples from one RMN to another, brands and agencies are left with more number-crunching and guessing. However, the opportunity to reach high-intent customers within a retailer’s network is too powerful to pass up.
So what’s the current state of the RMN-advertiser relationship? That was the focus of an IAB roundtable this week featuring agency and RMN representatives.
IAB introduced media measurement guidelines in September 2023 so RMNs and adtech partners could begin to help brands and agencies connect the dots. If it’s easier for advertisers to execute and measure campaigns across multiple RMNs, they’ll increase their overall spend, the theory goes.
“We were very cognizant that adoption [of measurement guidelines] would take 12 to 24 months,” said Jeffrey Bustos, VP, measurement addressability data at IAB. “I think from all the conversations with retailers, the momentum and their investment in moving toward standardization is still very strong.”
While standardization remains a goal rather than a reality, the increasing opportunities within individual RMNs as they expand offsite and in-store offerings make them something advertisers must consider.
CVS Media Exchange’s focus on shopping experience
“When you look at retail and consumer spending, a lot of that still happens in a store format,” said Praveen Menon, head of analytics and business intelligence for CVS Media Exchange (CMX). “Someone like CVS, who has 9,000 stores, [attracts shoppers] coming into these stores with a lot of attention and urgency, with a clear consumer need they’re looking to fulfill.”
CVS Media Exchange can measure the connection between when loyalty members search in the CVS app or online and when they purchase in-store through the loyalty program.
“Over 50% of our loyalty members, when they browse something online, they come to our store within 48 hours,” said Menon. “For us, the in-store experience is a key unlock.”
CVS plans to build better shopping and ad experiences through in-store screens and other touchpoints. The retailer has 1,700 screens in its stores and plans to add more this year.
Dig deeper: Why we care about RMNs
Data collaboration for offsite measurement needs
At some level, all RMNs serve the function of a data collaboration. The retailer uses customer data in a privacy-safe way to help outside parties serve timely, relevant messages. This collaborative environment extends to offsite channels beyond an RMN’s owned digital and in-store properties.
For instance, CVS partnered with visual discovery platform Pinterest and adtech company LiveRamp on a clean room initiative that helps CVS measure the effectiveness of offsite ads on Pinterest that lead to CVS purchases by loyalty members.
“What data clean rooms allows us to do is to provide advertisers and agencies with precise, attributed and meaningful performance insights for campaigns they run with CMX, especially on offsite channels where we have limited ad exposure data,” said Menon. “This really allows us to report back about performance with a high degree of accuracy.”
He added: “On some other platforms, where they don’t share some of those ad exposures or don’t collaborate via clean rooms, measurement is more of a black-box solution. So for us, as we think about our innovative offerings, we want every channel that brands invest in through CMX to be measurable.”
Advertisers and agencies push for standards
This collaborative environment might one day lead to multiple RMNs adopting the same measurement standards. That’s at least the intention with the IAB guidelines. Agencies are seeing great RMN interest from clients. Agencies and brands have influence, through the budget they spend, to support RMNs that are standardized.
“We have to put our money where our solutions are,” said Evan Hovorka, VP of product innovation, Albertsons Media Collective. “That might require some brands forcing the next dollar to go to an RMN that supports some of these adopted standards.”
“What’s really interesting is that our [clients] are so excited to adapt and test and learn, because they’ve seen the success of retail media,” said Kavita Cariapa, SVP, head of commerce activation at dentsu. “And luckily there’s actually a good framework being built out with partners like CVS and Albertson’s. There’s a groundwork built on tech partnerships, collaboration.”
“Outside of its adoption rates, there are a couple of [IAB member RMNs] that have done fantastic jobs,” said Riyaad Edoo, executive director of commerce at EssenceMediacom. “Accountability is really what holds progress back. If my investment (on behalf of a brand client) isn’t going to directly reflect what my asks are, then those asks are empty. But that might not be the right conversation. In most instances, we can survive on some amount of measurement inconsistency and not be happy about it. We do have advanced data analytics teams working tirelessly to sort of weather these anomalies.”
“One of our biggest wins that we present to our brands is, baseline, how to inform a channel investment,” said Cariapa. “There’s always questions on how and when and where to invest. How do they invest in a retailer as they expand their opportunities?
Dentsu reports how clients are growing market share with campaigns and how specific channels perform, so brands aren’t just tracking impressions but results, Cariapa said.
Less than halfway through IAB’s two-year estimated timeframe for guideline adoption, it looks like better RMN measurement is likely, as advertisers and agencies continue to invest in this growing ecosystem.
The post Retail media networks and advertisers going from guesswork to growth appeared first on MarTech.
**Title: From Guesswork to Strategic Growth: The Evolution of Retail Media Networks and Advertisers**
In recent years, the retail landscape has undergone a seismic shift, driven by the rapid evolution of technology and changing consumer behaviors. At the forefront of this transformation are Retail Media Networks (RMNs) and advertisers, who are increasingly moving away from traditional guesswork to embrace data-driven strategies for strategic growth. This article explores how this transition is taking place and what it means for the future of retail advertising.
### The Rise of Retail Media Networks
Retail Media Networks have emerged as a powerful force in the advertising ecosystem. These networks, operated by retailers, provide brands with the opportunity to reach consumers directly at the point of purchase. By leveraging their vast amounts of first-party data, RMNs offer advertisers a unique advantage: the ability to target shoppers with precision and relevance.
The growth of RMNs is fueled by the increasing importance of e-commerce and the decline of third-party cookies. As retailers build their own advertising platforms, they are able to offer brands insights into consumer behavior that were previously inaccessible. This shift is empowering advertisers to make more informed decisions and optimize their campaigns for better outcomes.
### Data-Driven Decision Making
One of the most significant changes in the transition from guesswork to strategic growth is the emphasis on data-driven decision making. Retailers and advertisers are now able to harness the power of big data and advanced analytics to gain a deeper understanding of consumer preferences and behaviors.
By analyzing data from multiple touchpoints, including online and in-store interactions, advertisers can create highly targeted campaigns that resonate with their audience. This level of personalization not only enhances the customer experience but also drives higher conversion rates and increased return on investment (ROI).
### The Role of Artificial Intelligence and Machine Learning
Artificial Intelligence (AI) and Machine Learning (ML) are playing a pivotal role in transforming retail media and advertising strategies. These technologies enable advertisers to process vast amounts of data in real-time, uncovering patterns and insights that were previously hidden.
AI-powered algorithms can predict consumer behavior, optimize ad placements, and even automate the creative process. This allows advertisers to focus on strategic planning and innovation, rather than getting bogged down in manual tasks. As a result, campaigns become more agile, responsive, and effective.
### Collaboration and Integration
The transition from guesswork to strategic growth also involves greater collaboration and integration between retailers and advertisers. Retailers are increasingly acting as partners, rather than mere platforms, providing brands with access to their data, insights, and customer relationships.
This collaborative approach fosters a more holistic view of the customer journey, enabling advertisers to create cohesive and consistent experiences across all channels. By working together, retailers and advertisers can unlock new opportunities for growth and innovation.
### Challenges and Considerations
While the shift towards data-driven strategies offers numerous benefits, it also presents challenges. Privacy concerns and data security are top of mind for both retailers and consumers. As RMNs collect and utilize vast amounts of data, they must ensure compliance with regulations and maintain consumer trust.
Additionally, the integration of new technologies and data sources requires significant investment and expertise. Retailers and advertisers must be willing to adapt and evolve their strategies to stay ahead in a rapidly changing landscape.
### The Future of Retail Media and Advertising
As Retail Media Networks and advertisers continue to transition from guesswork to strategic growth, the future of retail advertising looks promising. The ability to leverage data, technology, and collaboration will drive innovation and create new opportunities for brands to connect with consumers in meaningful ways.
In this new era of retail media, success will be defined by the ability to deliver personalized, relevant, and seamless experiences that meet the evolving needs of consumers. By embracing data-driven strategies, retailers and advertisers can position themselves for sustained growth and competitive advantage in the digital age.
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