Retail media networks are on the rise—and they aren’t just for the giants like Amazon anymore. Retailers of all sizes can use their first-party data to drive sales and bring in ad spend from their brand partners. But where do you start??
Hear from Forrester’s Collin Colburn, Epsilon’s Joe Doran, and CitrusAd’s Sean Cheyney recently discussed the future of retail media networks in a webinar. Here are five things they say you should look for:
1. Retail media is a huge opportunity.
Forrester says that on average, most retailers tell them that their retail media margins range from 50-70%. And those margins are even higher with on-site advertising, at 70-80%. A quarter of retailers are generating more than $100 million in revenue from their retail media networks.
2. Most retailers start their retail media business with off-site media.
Forrester’s Collin Colburn says: “Most do start with off-site media – being able to place media display, social ads, etc. on other publisher sites – using the retailer’s first party data that then gets traffic back to the retailer. This is a nice way to begin for most retailers that don’t have significant volumes of traffic… that’s a great place to start. And then once they start getting more of that traffic on the site, then they can start doing things like on-site search, on-site display, and being able to build offerings and capabilities around on-site and off-site media management.”
3. Retail media strategy typically falls in one of three buckets.
Ordered by popularity:
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- Retail media network as profit center: Stands alone as its own business unit or a division within e-comm; most similar to Amazon Advertising setup; more integration between online and in-store; goal is to grow the media business and gain greater share of brand/national media dollars while supporting online/offline sales.
- Retail media network as e-comm revenue generator: Attract more e-comm traffic; Grow e-comm revenue.
- Retail media network as cost neutralizer: Sits almost exclusively within the marketing organization; looks and feels more like a co-op program; less integration between online and in-store; goal is to get more traffic to the site, thus increasing sales online and offline.
4. Retail media’s future is going to be much different than its past.
CitrusAd’s Sean Cheyney says: “Retail media of the past was the big conglomerates. Today, we’re seeing a shift and we’re seeing retailers of all sizes getting into retail media and doing so successfully.” And that future hinges on your customer data strategy.
Epsilon’s Joe Doran says: “You can’t capture the full retail media opportunity unless you’re putting the shopper’s identity at the core of your monetization strategy. You have to be honest that you only have (as a retailer) a single look at that shopper, and you need a more holistic view of that person.”
5. The perfect retail media network doesn’t yet exist.
But most retailers say there are four things to consider when thinking about partners in the space:
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- All-in-one platform: Not only easier to manage but easier for brands to buy into.
- Customization & flexibility: What works for one retailer isn’t going to work for another.
- Real-time reporting & trusted measurement: Know, with confidence, who is in market vs. who just purchased.
- Personalization: First-party retailer data, coupled with external data, delivers mass personalization at scale.
For more info on how to get started with retail media, download our guide: 3 strategies for a successful retail media network.