Retail Media Networks are experiencing a significant and global surge in popularity as a preferred advertising channel for brands. That’s a no-brainer, as retail media earns retailers lucrative additional revenue and offers brands the chance to grow sales by targeting shoppers across the path to purchase.
While RMNs offer these excellent benefits to retailers and brands, it’s essential to remember the crucial third party in the equation: the shopper. Their purchases and data are central to the very essence of RMN propositions. RMNs mustn’t merely be tools for retailers’ profit or brand promotion strategies; they should actively add value to the shopping journey to keep consumers coming back for more.
Here are three reasons why putting the shopper first is non-negotiable in retail media:
1. Shopper Expansiveness:
Today’s shoppers are not tethered to a single retailer; there is no such thing as a Walmart-only or a Target-only shopper. Loyalty to one store is increasingly rare. Shoppers prioritize a seamless and enjoyable experience above all else. Overloading them with excessive or irrelevant ads risks driving them to competing retailers that offer a more enjoyable shopping experience and environment, whether that’s in-store or online. It’s crucial that RMNs ensure media strategies complement each other and contribute positively to the overall shopping journey. When done properly, retail media enhances the shopping experience by adding greater resources that help make purchasing decisions. Moreover, the messages conveyed must align with the brand and retailer’s unique propositions to avoid conflicting messaging that could confuse the shopper.
2. Losing Lucrative Data:
Disregarding the shopper’s preferences and experience not only risks losing the customer but also deprives RMNs of invaluable first-party data that is the lifeblood of their proposition. While our 15+ years of experience tells us that retailers’ data is even stronger than outgoing cookie data, it’s only good if it exists. If poor experiences alienate shoppers, retailers will have less valuable data to leverage.
Engaging, maintaining, and growing a retailer’s shopper base is pivotal for RMNs to gather the rich data necessary for fueling their networks, effectively targeting shoppers, and measuring their actions. Without an engaged audience and their data, RMN revenue streams are at risk of stagnation, impeding their longevity and success.
3. Improved Performance and Revenue Generation:
Prioritizing the shopper yields tangible benefits in terms of improved campaign performance, leading to increased revenue. Delivering data-led campaigns, whether through first-party data or an understanding of the best tactics to target shoppers, increases the likelihood of conversion. Seamless integration of advertising into the shopping experience fosters loyalty and long-term engagement, empowering shoppers in their decision-making process rather than disrupting it.
At SMG, centering the shopper is fundamental to our approach in achieving campaign success for both retailers and brands, and the results speak for themselves. According to data from Plan-Apps, our proprietary SaaS technology and the Operating System for Retail Media, SMG’s customer-first strategies delivered positive retail media revenue growth for 100% of our retailer partners and improved average brand ROI across our CPG partners by 90 percentage points in the last five years.
A recently forged partnership between CNET and Best Buy Ads exemplifies this approach, as it provides Best Buy shoppers with relevant CNET content to make informed purchasing decisions, enhancing the overall shopping experience.
Prioritizing the shopper isn’t just a moral imperative; it’s a strategic necessity for RMNs. Collaboration between RMNs and brands that center shopper interests unlocks new opportunities for growth, differentiation, and sustainable success in this dynamic and competitive retail media landscape. By recognizing the interconnectedness of retailers, brands, and shoppers, RMNs can ensure their own longevity and prosperity. For those not aware, that’s the essence of our name SMG: the seamless link between the retailer, the brand, and the shopper.
