Is “retail media” really a new thing?
Retail and media have been around for generations, and they’ve clearly been crossing paths for probably the entire time. It’s the way consumers experience it that keeps changing – from radio and TV ads to product placement to streaming content on smart cart screens.
I recently had the opportunity to share my thoughts on retail media with Progressive Grocer. The trade journal offers a great snapshot on the current state of retail media and thoughts on where it’s going next. But I’d like to expand on some of my thoughts that PG didn’t have room to include.
One angle that I find particularly interesting with retail media networks (RMNs), though a bit contrarian, is that it’s not necessarily a revolutionary “new thing.” Instead, it’s simply the latest iteration of “media” that a retailer can offer to consumer packaged goods (CPG) brands.
It’s a natural evolution of the advertising landscape, where media opportunities evolve over time as technology and consumer behavior change. This perspective helps reframe RMNs as part of the ongoing evolution of how retailers engage with brands – just the latest chapter in a long history of media offerings.
Much has been said about creating a seamless experience for consumers, whether they experience a store physically or digitally. But with the customization possibilities attainable with RMNs, this begs the question: Do online and in-store offerings really need to be aligned?
As I contend in the PG article, this need not be the case. The cost structures for supporting the different channels vary, so why should the offers and prices be the same?
While it’s convenient to have uniformity across channels, there’s actually an opportunity for retailers to offer differentiated pricing and promotions across channels to drive profitability. This ultimately depends on how well a retailer can represent their brand across different platforms – whether in store, first party or third party – and maintain consistent messaging to nurture their target customers.
Achieving this balance is easier said than done, and it’s a challenge that retailers have been tackling since 2020. We are now seeing various approaches to solving this challenge.
As for the future, I don’t have a clear view on how RMNs will directly impact traffic or overall sales. There might be some initial shifts and early benefits for those who move first, but eventually, the market will settle into a new normal where well-curated and targeted ads become the standard way of reaching consumers.
The real growth driver will come from population growth and increasing wealth; otherwise, we’ll likely see trading within the market. Of course, I’d prefer to be on the winning side of that outcome.
Fortunately, RDSolutions being part of the Markel Ventures family (rather than being funded by private equity) allows us to focus on long-term relationships and successes, rather than chasing short-term wins.
As I noted in Progressive Grocer, RDSolutions is working on a suite of solutions designed to support mid-market and independent retailers in implementing RMNs, to give them a boost alongside large national chains that have been able to invest considerable resources in the technology. Given the complexity involved, we believe the key to success in retail media is partnering with retailers who are genuinely committed to long-term RMN solutions.
Meanwhile, RDSolutions’ comprehensive intelligence platform combines billions of data points per week to monitor brand-critical metrics across every major U.S. market and all e-commerce channels. Customizable and integrated with our in-store and online operations teams for near-real-time action, RDSolutions empowers retailers and manufacturers to achieve Total Brand Excellence.
