Retail media networks are on the rise.
According to eMarketer, retail media advertising will reach $41.37 billion in 2022, a $10 billion increase from 2021. It is one of the fastest-growing segments of digital advertising, and retailers (and brands!) are taking notice.
So, you want to start a retail media network. Or maybe you have one but are trying to find a way to amp up your performance. Whatever the reason, retail media networks are becoming a staple in the digital advertising landscape and marketers who don't at least consider it as part of their larger business strategy will be left in the dust.
Question: How does a retail media network work?
Retail media networks are advertising platforms retailers set up on their website, app or other digital properties, as well as properties they do not own like CTV and on other websites. Dubbed the new "digital shelf space," these networks allow retailers to promote brands in their stores. Some networks exist solely on-site, but full-scale solutions can serve advertising both on owned digital properties as well as off-site ones, too. The omni-channel approach has emerged as the most popular, though, as advertisers can meet consumers where they are.
These networks don't just act as a means of advertising, though. Unlike their in-store ancestors, retail media networks allow retailers and brands the chance to access and analyze first-party consumer data and channels. With this, brands can reach in-market buyers at the point of purchase across formats and channels.
In layman's terms: Brands are leveraging incredible data and digital properties to target the right consumers which helps calibrate their marketing efforts, and retailers can drive revenue. A real win-win.
Question: Sounds interesting. But is a retail media network really right for me?
As more shoppers move online, having this as part of your overall strategy is going to be essential. These networks offer huge revenue potential and are becoming an imperative part of retailer’s digital strategy—especially in response to COVID-19. Retail media networks aren't just for giants like Amazon or Walmart, these solutions are going to become a common place for retailers of all sizes.
So what's really in it for you, the retailer? Besides a treasure trove of first party data that can fuel marketing insights, a retail media network can do lots of cool things.
Reach more customers: Good first-party data coupled with an on-site and off-site solution means you can reach two to three times more of your customers. Not only that, you'll find customers that will actually respond to your messaging.
Target across emerging channels, including connected TV(CTV): An effective retail media solution is going to work across channels. As CTV and mobile continue to grow, you're going to want access to all digital properties you can get your hands on.
Diversification: Plain and simple, a well-oiled retail media network acts as a diverse revenue stream. As brands look to spend more in this digital advertising space, retailers want a piece of the pie. This revenue can fuel growth projects and create a revenue floor.
Question: Okay, this all sounds good. How do I actually start a retail media network, though?
A wise man once said, "Rome wasn't built in a day." Luckily for you, retail media networks aren't Rome! First thing’s first: Starting a retail media network can be done one of two ways. You either do it all in-house or you work with a vendor (or vendors) to partner with.
Going it on your own: Doing it all in-house can be a great solution—if you have all the tools to make it work. For those looking to DIY, here are some key questions you’ll want to ask before pulling the trigger:
What are your media sales, account management and creative support capabilities?
What do your measurement capabilities look like?
What inventory is available for your brands? (on-site, off-site, email, social, etc.)
Would we need to hire any additional staff to make this work?
Starting a retail media network internally can require a lot of time and resources if you don't have the right tools to do it. And, if you're going to start a retail media network, you want to do it right for peak optimization.
Finding the right partner: Flying solo can be quite an undertaking, so it’s a good thing that there are partners out there who have full-scale solutions that offer everything you need: Easy campaign set up, flexibility, massive scale on all size inventories, and performance measurement that is in real-time.
And a lot of these partners—including Epsilon—offer turnkey options for retailers both big and small.
Question: Wow, this is great! But there's so many vendors out there. How do I know which one to pick?
Now that you've realized starting your own retail media network might be a bit of a beast to bear, the next natural step is looking for a vendor who can serve your needs.
First, you need to look at capabilities overall. There can be a lot of bells and whistles to a retail media network, but if you want one that continually feeds itself, you're going to want a three-pronged solution: On-site, off-site and in-store.
On-site capabilities mean you can serve ads on the digital properties you own. Off-site capabilities mean you can serve ads on digital properties you don't own. And in-store means, well, in the store (think digital displays). Most retail media networks can only operate on-site, but with that model you're limited to the customers you're able to reach. With off-site advertising, you can draw people into your site vs. waiting for them to come on their own. Without both working together, you're potentially leaving millions of dollars on the table.
In-store is an added benefit. Despite a huge shift toward online shopping, people are still making offline purchases. The only type of retail media network worth having is one that has a 360-degree view of where the customer is and when.
Which leads us to measurement. It's not enough to have a retail media network, if you're going to do it, do it right. Look for partners who can offer you in-depth, SKU-level measurement across channels, ones who can manage performance coupled with real-time optimization that offers transparency and accuracy every time.
This three-channel approached matched with real-time measurement is going to catapult your retail media network from good to excellent. And with that comes better insights, increased brand partnerships and, most importantly, bigger revenue.
If your vendor can't offer you that, they aren't worth your salt.
But you're in luck! Powered by Epsilon's best-in-class identity, our retail media solution is poised to give you a holistic network that works online, offline and everywhere in between. With Epsilon, you have access to 200 million+ consumers that we tap into 8x per day—far and above what our competitors offer.
Want to know more about Epsilon? Download our retail media network guide for an in-depth look. And, if you're a brand looking to find a retail media network to hitch your wagon to, be sure to check out our eBook on what that could mean for your brand.