The retail media landscape is undergoing a seismic shift, and as brands and retailers seek new ways to connect with consumers, retail media has become a powerful tool blurring the lines between commerce and content. It is redefining digital advertising and offering unparalleled opportunities to engage shoppers at every stage of their journey.
Harrison Bland, eCommerce Director Publicis Media and member of the IAB Australia Retail Media Council recently spoke at IAB New Zealand’s sold out event ‘Beyond the Shelf: The Future of Retail Media’, sponsored by Google and Market Media, and shared some of his key insights with StopPress.
Q1: In a media and advertising landscape that is constantly changing, some forms are declining in use while an area like retail media is on the rise. What is retail media’s point of difference and what does it offer brands and retailers?
Retail media is a data-rich, cookieless solution. Its value and key point of difference comes from leveraging first-party data to deliver highly personalized, relevant content, based on shopper behaviour.
For brands, it provides incredibly powerful targeting. While many areas of commerce media build ‘in-market audiences’ based on elements like product page views over the past 30, 60 or 90 days, retail media utilises historical purchase and purchase frequency data to identify shoppers most likely to convert.
For retailers, it’s a new revenue stream, evolving from in-store media alone, to cross channel amplification powered by the monetisation of retail data.
In 2022, it was estimated that 10% of total retailer revenue came from digital and ecommerce channels. By 2026, it’s forecast that over 30% of total retail revenue will come from digital and ecommerce channels, as per a recent PWC report.
Q2: The retail media landscape is undergoing a major change as brands and retailers seek new ways to connect with consumers. What are the biggest shifts happening in this space right now?
Brand and retailer organisations are in a period of immense transformation. As retail media grows, organisations need to ensure their teams have clear roles and responsibilities to strategically leverage retail media and to reach the right consumers.
Each year Profitero runs a global eCommerce Organizational Benchmarking study which surveys hundreds of ecommerce leaders and determines top organizational priorities, challenges and more. In the last report, 63% of respondents said they had been through a restructure within the past two years and 40% stated the re-structure was ineffective, not going far enough to merge teams into a true omnichannel structure. Two patterns were identified as the key obstacles:
1. Poorly defined roles and responsibilities between team members
2. Inadequate training and upskilling developed to support new ways of working
To successfully manage this shift, organisations need to ensure their teams have clear roles, responsibilities and training to thrive in the fast-evolving retail media landscape.
Q3: How is retail media blurring the lines between commerce and content? What trends are you seeing in this space?
More and more, we’re seeing brands use content as a conversion tool – both in paid and owned. On Amazon in Australia, brands that include video content on product pages are seeing up to 21% higher conversion rate compared to those that don’t. Leveraging the same assets in media ensures creative consistency and, in our experience, delivers stronger results, especially when the creative is unique to shopper interests. The blurring of lines is really a convergence of creative commerce excellence which, ultimately, will drive more effective results and will be more engaging for shoppers.
As for trends, historically word of mouth has been the most influential factor for many buyers: What did your parents buy? What are your friends buying? And today, what are your favourite influencers buying? For many shoppers, influencers are the most trusted source for product reviews – think ‘TikTok made me buy it’, with some retailers even including whole sections in-aisle full of products that are trending online. Brands that can effectively utilize user generated content in media and at point of sale are leaps and bounds ahead of brands who focus on front and back shots of products alone.
Q4: Where are the budgets for retail media coming from? What do you think would further accelerate retail media adoption in the marketing mix?
Budgets are starting to come from all teams within brand organizations, but most commonly it is being funded by retail/trade/sales teams, with investment being taken from existing brand-retailer joint business plans. To accelerate adoption of retail media within the broader marketing mix, retailers need to provide better transparency on the true incrementality retail media is delivering from both self-serve and managed-service media solutions. Retailers also need to work more closely with media agencies, who are often the gatekeepers for brand marketing investment. To tap new budgets, agencies and advertisers need to understand the true value and potential of retail media.
Q5: What is the most exciting retail media development you can see on the horizon?
While it’s not always the sexiest topic, measurement and reporting transparency is one of the most exciting developments on the horizon, and a topic we’re actively discussing across IAB Australia and IAB New Zealand.
Key metrics like new-to-brand and incrementality is a frequent question. Brands want to understand what their additional investment is driving, so they can determine which channels and formats are most effective to keep as part of their evolving marketing mix.
We’re also getting closer to establishing a single return on investment (ROI). With the convergence of trade budgets and brand marketing budgets into singular integrated marketing planning teams (omnichannel structures), we’ll hopefully soon be able to review true ROI based on total investment per retailer, so brands can more effectively determine where they increase budgets based on outcomes.
