Retail media strategy: The three stages of retail media success

Published: June 4, 2024 by Anne Passon

Retail media: Three steps to success

Retail media networks (RMNs) rank among the fastest-growing media channels. According to eMarketer, retail media spend is forecasted to account for more than a fifth of overall digital spending in 2025, and retail media spend will grow by 21.8%. For RMNs, the path to realizing this opportunity is marked by navigating through a series of critical stages, each with its own set of challenges and solutions.

Retail media strategies

Simply put, RMNs need to know who their customers are, where they are, and how to reach them to succeed.

But we know nothing is that simple. This blog post reviews the three pivotal stages of RMN success, offering a roadmap for networks aiming to optimize their operations and claim their share of the rapidly growing category.

Stage 1: Develop a data foundation

In a world where traditional tracking methods are fading, first-party data has become essential for targeted advertising. Retailers have a wealth of this valuable data due to their direct consumer relationships. The initial step in establishing an RMN is to organize and utilize this data effectively.

Steps to develop a data foundation:

  1. Organize data: Bring together fragmented shopper data, loyalty program information, and other customer data into a unified location. Clean and deduplicate this data to create consistent customer profiles.
  2. Enhance profiles: Gain insights into your customers and your brand’s customers so you can learn who your best, lapsed, and non-customers are. Append additional attributes to your shopper data, including media consumption habits, lifestyle preferences, demographic information, and more.
  3. Use identity graphs: Identity providers, like Experian, enable you to learn about the anonymous – and known – visitors on your platform and organize disparate customer data points into households. This will allow RMNs to connect addressable identifiers to the household, making it easier to reach customers across channels.
  4. Create audience segments: With a solid data foundation, RMNs can build audience segments beyond basic shopper data. These segments will make your data more attractive and actionable for media buyers.

For example, consider a retailer that knows its shoppers are primarily young professionals, but a CPG brand wants to target not only these shoppers but also young professionals who are parents. By partnering with an identity solution provider like Experian, the retailer can append additional data to identify and target the young parents within their existing customer base, enabling the CPG brand to reach both audience segments effectively.

“Retail media networks thrive on clean, accurate, and actionable data. Simply put, it’s crucial to know who your customers are, when they’re most engaged, and where to reach them to drive effective marketing strategies and maximize ROI.”

anne passon, sr. director, sales, retail

Stage 2: Become a publisher for optimal retail media growth

The next step for RMNs is to transition from building a data foundation to helping marketers reach their target audience, essentially becoming a publisher. This involves two main processes: organizing advertising inventory and connecting it to demand.

Steps to become a publisher:

  1. Audit and organize inventory: Conduct a thorough review of all existing ad spaces, including websites, apps, and in-store placements. Identify gaps and consider creating new advertising opportunities, such as website and app features, interactive digital experiences, or expanded in-store touchpoints.
  2. Connect inventory to demand: Integrate the organized inventory with platforms, allowing advertisers to access it easily. This often involves using supply-side platforms (SSPs) and demand-side platforms (DSPs).

Continuing with our example, the CPG brand can work with its DSP or SSP partners and easily access your ad inventory, and effectively target the young professional and young parent audience segments.

Stage 3: Scale inventory for retail media growth

As RMNs progress to the final stage of their success journey, they may face the challenge of limited inventory within their owned and operated (O&O) channels. To meet marketers’ expansive reach requirements and to continue to drive growth and profitability for their organizations, RMNs must expand their inventory beyond O&O.

Steps to scale inventory:

  1. Utilize data collaboration tools: Clean rooms allow secure merging and enrichment of data from various sources, creating richer audience profiles while maintaining privacy.
  2. Resolve identity and enhance addressability: Identity graphs help resolve known customer identifiers (e.g. emails) into addressable IDs (e.g. mobile IDs and connected TV IDs), which can be used to reach customers across all the platforms they consume media.
  3. Expand audience reach: Onboarders, like Experian, help extend data and audiences to programmatic destinations beyond a retailer’s O&O inventory. By mapping audiences to digital identifiers maintained by identity partners, RMNs can significantly widen their reach, meeting advertisers’ needs for engaging with broader and more diverse audience segments.

The CPG brand can now reach young professionals and young parents on the retailer’s platform and in all the other places where they consume media, like watching their favorite shows on connected TV (CTV) or browsing the web on their phones.

Measurement across stages for retail media growth

Measurement is crucial and must be conducted during and after a campaign to understand and validate performance. Here are two types of measurement to consider:

  1. Cross-device campaign measurement: Measure performance by connecting an ad exposure in one environment (e.g. CTV) to an action in another (e.g. mobile purchase). This holistic, cross-device approach requires a partner for identity resolution as it will ensure that the impact of a campaign is fully understood.
  2. Aggregate performance analysis: Understand performance in aggregate across several campaign studies. Receive independent third-party measurement validation that you can promote to advertisers to drive increased spend.

For our CPG brand, these measurement reports ensure that they can track the performance of their campaigns from the initial exposure on a CTV to the final purchase made on a mobile device, providing comprehensive insights and validation of their advertising strategy. The retailer can aggregate these studies and promote their network’s effectiveness to prospective advertisers.

Accelerate retail media growth with strategic partnerships

The journey through the stages of RMN success is riddled with deep technical challenges that are often beyond the institutional capabilities of non-media businesses. The intricacies of data management, audience insights, identity resolution, precise cross-device targeting, and measurement require specialized expertise and technologies that may not be readily available in-house.

RMNs stand to benefit from forging strategic partnerships with companies that possess not only the necessary technological tools but also a profound understanding of the media landscape. The steps outlined here will accelerate your growth and ensure you capitalize on the opportunity in front of you.

Connect with a member of our team to learn how we can support your journey toward RMN success.

Contact us to enhance your retail media strategies

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