Standing out and capturing the attention of consumers is more challenging than ever for brands competing in today’s advertising landscape, yet one area still presents a significant, growing opportunity for CPG brands to win hearts and minds: retail media.
Why do grocery brands need a retail media strategy? Simply put – to grow! Think of it like an old idea with a new twist, because you’re pursuing the same outcomes but using the latest trends and audience access to do it. When leveraged appropriately, Retail Media helps brands engage new audiences, personalize messages using data and optimize advertising spend to gain that much needed competitive advantage online and in store.
In fact, WARC’s Marketer’s Toolkit 2023 listed retail media as the fourth-largest advertising medium with an ad forecast of $121.9 billion globally in 2023, up 10.1% from the previous year. Despite an oversaturated advertising space, retail media marketing helps cut through the clutter to target specific audiences and ultimately serve as a big growth opportunity for your brand.
Digital vs. In Store: Understanding the Two Types of Retail Media
When it comes to retail media, there are two primary categories to consider. The first is in-store retail media, encompassing traditional methods like point-of-sale (POS) advertising, in-store TVs, checkout screen ads, aisle-end displays and circulars.
The second category is digital retail media, where brands place ads on relevant e-commerce sites and retailer mobile apps. Digital retail media can be further divided into two types: third-party providers like InMar, Quotient, Ground Truth and retailer-owned media properties like Walmart Connect.
In our opinion and deep experience in the shopper marketing industry, digital retail media represents the most significant opportunity for brands seeking a competitive edge and will be our focus for this article.
How Can Retail Media Benefit Your Brand?
Retail media offers several benefits for CPG brands, including:
- First-Party Data: By leveraging retail media, brands gain access to valuable first-party data, enabling them to better understand their target audience and tailor messages accordingly.
- Right Place, Right Time: With retail media, brands can deliver their ads to consumers at the most opportune moments, whether it’s when they are actively shopping or browsing relevant products.
- Performance and Personalization: Retail media allows brands to optimize their campaigns based on real-time data, ensuring better performance and more personalized experiences for consumers.
The Potential Challenges of Retail Media
While retail media presents significant opportunities, like any marketing channel, there are some potential downsides to be aware of:
- It’s Like the Wild West: The digital retail media landscape is still evolving, and retailers are in the experimental phase, trying to determine pricing, expected results, and the best-fit opportunities. Now, more retailers are also creating their own platforms with unique offerings which creates a lack of standardization and adds complexity to the process.
- It Can Be Expensive with Nebulous ROI: Retail media opportunities often come with a significant price tag. Many activations will start around $10,000 making them cost-prohibitive for smaller brands. Additionally, due to the evolving nature of this marketing channel, the expected ROI may not always align with the initial projections. Like other marketing opportunities, ROI may also be difficult to track.
- For Smaller Teams, It’s Complicated to Manage: Managing multiple partnerships with different retailers, retail media networks and third-party vendors can be complex for CPG brands who don’t have the dedicated resources. Each partner may have unique capabilities, requirements, timelines and budgets, adding to the overall complexity.
Creating an Effective Retail Media Strategy for Your Brand
Despite the challenges associated with retail media, retail media is here to stay. It provides a unique opportunity to engage new audiences, personalize messages based on data insights and optimize advertising spend for maximum impact. All powerful ways to stand out in the marketplace!
In a world where consumer behavior and shopping patterns continue to evolve, integrating the growing opportunity of retail media into your shopper marketing strategy is essential for staying relevant in the CPG industry.
The key to success in this ever-changing industry is data-driven optimization.
A Data-Driven Strategy to Gain a Competitive Edge with Retail Media:
Use the Scientific Method to Hone Your Approach: Given the evolving nature of retail media, it’s crucial to approach it scientifically. Test your theories, analyze the results and refine your approach based on data-driven optimization.
- Test Your Theory: Start by identifying your target retailer, budget, timeline and key performance indicators (KPIs). Determine the best-fit opportunities for your brand and launch a campaign to gauge its performance.
- Analyze the Results: Leverage the data provided by retail media to evaluate the performance of your campaign. Consolidate and share the data through comprehensive reports to gain insights into shopper behavior and the campaign’s impact within your broader marketing strategy.
- Refine Your Approach: Regardless of the campaign’s performance, there is always room for improvement. Keep a record of what works and what doesn’t, making the data accessible to your marketing team as case studies for future experiments.
The Easy Button: Bring Our Shopper Marketing Experts In
To make the most of retail media, consider partnering with a proven shopper marketing agency that specializes in creating unique brand experiences through innovative retail marketing strategies. At Cliffedge Marketing, we sit on the same side of the table as your team to provide the dedicated resources and expertise to unleash your campaign’s sales potential, connect with shoppers and navigate the complex retail environment.
We’re always excited and ready to serve top brands or emerging retailers looking to expand their profile in this complex, fast-paced retail environment.
Ready to unleash your campaign’s sales potential and connect your brand to shoppers everywhere? It’s time to meet the creative shopper marketing experts at Cliffedge Marketing.