The Lead: Retail Media
Welcome to the rapidly evolving world of retail media. In this installment of The Lead: Conversations That Matter, Ovative experts sit down to discuss all things retail media—the challenges, the benefits, and untapped potential.
Below, you’ll find thought-provoking videos on:
- Why It’s Difficult to Start a Retail Media Network
- Retail Media Reporting Challenges for Advertisers
- Why Advertisers Don’t Trust Retail Media Reporting
- How Clean Rooms Are Revolutionizing Retail Media
- Retail Media Network Trends to Stay On Top Of
Pull up a chair for an inside look at retail media networks (RMNs).
Why It’s Difficult to Start a Retail Media Network
Retail media is emerging as a powerful marketing channel, but brands are facing challenges in unlocking and scaling their efforts. One major roadblock centers around internal team dynamics—activating on a cohesive strategy, navigating competing priorities, and aligning on roadmaps across teams. Brand safety is another major concern for brands setting up their own RMNs. Putting ads on a site inherently has the potential to impact the user experience and the brand’s image. The solution to this and other challenges? Full organizational alignment of priorities and clear communication between RMNs and merchants, ensuring the full potential of retail media advertising can be unleashed.
Retail Media Reporting Challenges for Advertisers
Standardizing reporting metrics is a hot topic in the retail media world. Every retailer has their own metrics and their own reporting methodology. But how can advertisers truly understand what they’re buying and where their dollars are going when the process varies across retailers? For that matter, how do we understand success when it looks so different across RMNs?
Ovative experts believe we will eventually see standardization across different RMNs—but it’s not going to happen all at once. As advertisers grow more sophisticated in understanding and buying retail media, they’ll likely begin to pressure RMNs to provide greater transparency. We expect to see smaller retailers make changes first to meet stricter reporting standards requested by advertisers. Eventually, bottom-tier and mid-tier RMNs will likely coalesce around industry standards. However, larger RMNs with greater negotiating power like Amazon and Walmart may maintain their own metrics and ways of working.
Why Advertisers Don’t Trust Retail Media Reporting
A popular topic in retail media is incrementality and reporting accuracy. Retail media sits so low in the purchase funnel that some advertisers wonder about the right attribution methodology to demonstrate success. Could RMNs be counting purchases that would otherwise have made their way through the funnel?
Not all RMNs offer an incrementality metric—or advertisers have to spend to a certain level for visibility of the metric. Add that to the lack of reporting standardization and you have enough reasons for retailers to be skeptical.
Ovative experts have been exploring the best way to break open the “black box” of RMNs since 2017. Our magic solution? Enterprise Marketing Return (EMR), a single, unified metric that shows the full impact of a marketing program. Extending this strategic approach and unified metric into the retail media space has become increasingly powerful for brands.
How Clean Rooms Are Revolutionizing Retail Media
Without retail media reporting standardization, data privacy is more important than ever. The solution? Data clean rooms that provide a safe, privacy-friendly environment for data sharing and analysis. RMNs provide their audience and transaction data, and brands use their own resources to securely run attribution methodology and interpret their retail media results.
While this workaround for metric standardization appeals to more sophisticated brands, not every business is equipped with the data science resources to leverage clean rooms in this way. To expand access, we may see RMNs providing clean room usage as part of their own programs.
Data clean rooms are used for more than just metric standardization. Rich retailer data can be used to more deeply understand audiences, and even match them with transactional data. However this application evolves, our experts are excited to see clean rooms increase media efficiency.
Retail Media Trends to Stay On Top Of
Emerging channels like RMNs always have something exciting in store.
AI Is Changing the Retail Media Landscape
Ovative experts predict Artificial Intelligence (AI) will have the largest impact on RMNs, fueling personalization that yields improved customer experiences and audience targeting. AI has many potential applications, from audience analysis to matching the right creative to each viewer.
The In-Store Experience Is Being Digitized
Another trend to watch is the digitization of in-store. With about 90% of sales still happening in-store, it’s crucial to capture people at the point of purchase.1 Incorporating an in-store digital presence will level up your retail media strategy. This digitization will bring its own measurement challenges, which we look forward to tackling!
Source: [1] Retail Dive
Tap Into the Power of Retail Media Advertising
Whether you’re exploring the possibility of starting a retail media network or you’ve already invested heavily in retail media advertising, this emerging channel offers an invaluable opportunity for brands to target consumers close to the point of purchase. But given all the challenges we’ve discussed, it can be difficult to get started or take your program to the next level.
Ovative unlocks enterprise impact for our clients by activating paid and organic tactics across major and emerging RMNs. Speak with our retail media experts to learn more about how we can help you take full advantage of the power of retail media advertising.
