Increasing margins may be the ultimate endgame in retail, but creating a memorable shopping experience is equally paramount. Reaching consumers with meaningful messaging at the point of purchase can go a long way in helping to inspire impulse buys, drive up units-per-transaction (UPT), and instill shopper loyalty. To this end, retail media networks (RMNs) are proliferating, unlocking new monetization potential for the multi-brand retailer. A balanced RMN strategy encompassing both online and in-store channels can actually subsidize a revamped shopping experience through programmatic ad revenue.
A recent wave of investment in the space by big-box retailers like Home Depot, Walgreens, and Walmart is sparking new interest in RMNs, as their ROI has become clear. Among a group of retailers recently surveyed, 34 percent of respondents expected 26-75 percent RMN ad revenue growth in 2021.[1] This projection should come as no surprise. With a cookieless future approaching, brands are seeking out third-party targeting alternatives, and RMNs provide an effective way to reach consumers at the last mile, where shopper behavior is predictable and they have their carts open and payment in hand.
As more retailers deploy RMNs, the importance of in-store digital marketing networks in an RMN strategy cannot be ignored. Despite e-commerce growth as a result of the pandemic, three in five U.S. adults prefer to shop in-store,[2] and by 2025, 76 percent of goods are estimated to still be purchased offline.[3]Modern in-store digital marketing networks with programmatic advertising technology bring multi-brand retailers and RMNs a powerful suite of storytelling tools to reach these audiences. With them, it's much easier for brands, consumer goods companies, and retailers to forge meaningful connections with shoppers, create more shoppable moments, and extend omnichannel messaging into the last mile.
Unpacking the advantages of in-store digital marketing networks in RMNs
As a result of the pandemic, consumers are buying more goods but spending less time in-store. RMNs with a robust in-store digital marketing network give retailers and brands a unique way to make the most out of that time. They can help to extend shopping trips by enabling tailored messaging that leads to more memorable shopping experiences.
Not only is a positive in-store experience linked to return visits, but it can also drive more online interactions with brands experienced in-store. 90 percent of respondents in a Raydiant survey replied that they'd be more likely to return to a store after a positive experience, while 65 percent reported that a positive in-store experience was more likely to prompt them to seek out brands they saw in-store online.[4] What's more, shoppers often research products online before making a purchase in-store. Mobile and online data from customers who did their homework can be used to extend more relevant omnichannel messaging to in-store displays.
Customer loyalty and transaction data also play a huge role in the in-store digital marketing network. We're seeing retailers use it to drive tailored messages on a per-screen basis throughout the store, and encourage sales at high-intent purchasing locations like the cash register. At the same time, point of sale (POS) data is also increasingly being used to play ads that direct shoppers to surplus stock, while external triggers like bar codes are being tapped to ensure more relevant product messaging. The options are endless.
From a creative perspective, in-store digital marketing networks also lend a dynamic canvas and support customized messaging that aligns with real-time conditions like weather, time of day, etc. An in-store display might advertise cold beverages available at a nearby coffee kiosk as you enter the store on a hot day, or a display located in the freezer section of a grocery store may offer a chicken wing promo after the local basketball team won the first playoff game. The creativity, flexibility, and in-person interactions that these networks enable are proving indispensable, especially as more consumers venture out after a year of lockdowns.
Overcoming hurdles to widespread adoption
Momentum around RMNs within the advertising community is building rapidly, with 66 percent of brands expecting to run a media campaign on an RMN this year according to an Inmar Intelligence Brands Survey.[5] Big-name retailers are responding by launching media companies adjacent to their primary businesses, with Walmart's recent DSP launch just one of many examples. Looking specifically at in-store digital marketing networks, however, adoption is moving slower, with some retailers reluctant to follow suit for a few reasons.
There are misperceptions about what it takes to establish and manage an in-store media network. First, there's a general belief that they're complex and costly to implement and maintain. The premise of buying physical hardware and procuring a team to manage it and sell screen space alone is enough to induce capex fears. Second, previous experiments with signage in-store may have led to negative experiences, whether because of using low-end technology or having developed a basic in-house solution without an understanding of best practices to scale. Finally, integrating in-store media inventory with programmatic advertising platforms that make it accessible to brands has proven technically complex to date.
Forging the path ahead
Retailers around the world are beginning to experiment with in-store digital marketing networks as part of a larger RMN strategy, with Albert Heijn as one example. We're also seeing a range of third-party media networks service the industry – from Starlite in the U.S. to ClearChannel in the UK for Tesco and Sainsbury, and MediaPerformances for Carrefour and Auchan in Europe. That said, for more retailers and brands to capitalize on in-store digital marketing networks, work remains.
Marketing and digital signage technology developers must address misconceptions about the associated capex and ongoing maintenance responsibilities and clearly communicate the long-term advantages. They must also work to make in-store digital marketing networks simpler to implement and upkeep, and the resulting programmatic inventory more accessible to brands. However, input from merchandising and in-store digital marketing teams, and consumer goods companies and brands is a vital part of the equation. With it, the technology community can make in-store digital marketing networks an even more powerful storytelling channel over time.
These networks are just beginning to take off, and the more CPG brands see their capabilities and effectiveness in an RMN strategy, the harder they'll be to overlook. As leaders in marketing and digital signage technology development continue to engage with industry players, determining a solution that best addresses the needs of retailers and brands will become more straightforward. The resulting in-store digital marketing networks will open the door to a truly transformative shopper experience that more than pays for itself.
- Breaking Research Reveals That Retail Media Networks Are Vital, Not Niche
- A New Study of U.S. Shoppers Signals A Return of Confidence
- The Future of the Store
- Report: The State of Consumer Behavior 2021
- INMAR INTELLIGENCE RMN BRANDS SURVEY OVERVIEW
via https://www.aiupnow.com
Karim Kanji, Head of Sales, Broadsign, Khareem Sudlow
