In-store retail media, the next battleground

An interview with Blandine Multrier relevanC's Managing Director, Retail Media

5 min read

In-store retail media seems to be headlining everywhere at the moment. You only have to look at this year’s NRF agenda to see something is going on: “The Golden Age of retail media networks: How physical retail is unlocking RMNs' full potential” and “What’s In Store for Retail Media Networks”. 

So what is all the fuss about? Endcaps and digital displays have been around forever. Isn’t in-store retail media simply DOOH with a sprinkling of tech? (well not if you believe Advertima’s CEO! )  And, surely online is where all the innovation and future profit lie. 

The answer is nuanced, and mirrors to some extent the evolution witnessed in online advertising from static banners unrelated websites to retail media as we would define it today: ads relevant to the individual, placed near to the point of purchase decision. The key difference between the two is the ability to collect and use data to a. increase the effectiveness of the ad and b. show the correlation between ad spend and sales. Together these present an opportunity for retailers to increase competition between advertisers for in-store ad inventory. 

In 2020, COVID-19 saw a shift to online shopping and a real boom in online retail media that accompanied it. More recently, we have witnessed a swing back to physical stores bringing a new phase for advertising: in-store retail media.

What is in-store retail media?

What makes in-store retail media different from traditional in-store advertising is that with consumer data now available to retailers, it’s possible to quantify its value in-store inventory to potential advertisers. As mentioned above, advertising in-store is not new. Nor is advertising in-store using a digital medium. In-store inventory is limited by the physical space available and, its scarcity makes it highly sought after by brands. That’s because placement and content can be planned based on a good understanding of who is going to view it and how that might influence their buying behaviour. And unlike online advertising, where a customer can leave a page and come back at a later date, establishing a link between an in-store ad or promotion and sales is straightforward.

We are seeing incremental experimentation with the goal of personalising in-store advertising. This allows brands to have an opportunity to deliver a specific message to shoppers based on data in-store... in short, it’s the insights derived from this data that make the potential of in-store retail media so compelling”

Why is it important for retailers and advertisers?

It’s an oft-cited fact that while online gets a lot of press, the reality is that 80% of customers shop in-store. For a retailer like Walmart, that’s an audience of 240 million customer visits each week. So being able to segment and target that audience in a meaningful way in-store can bring enormous financial benefits to retailers and advertisers. ( E-marketer estimates the global market for instore ad spend will triple in the US by 2027)  This gives brands advertising through Walmart’s retail media networks an opportunity to vastly increase advertising reach.

Firstly, moving in-store display advertising from static to programmatic opens up “on-top” revenue opportunities for retailers. This allows the retailer to open in-store inventory to the highest bidding advertiser. Second, the benefits are clear also for the supplier: they are paying for a better-performing service. Ads are displayed dynamically according to predetermined targeting criteria based on attributes such as store hotspots, competitor product location, and even the customer profile. 

But the ability to influence shopper behaviour at the point of purchase is not the whole story. In-store retail media has a push-pull effect that brings what’s happening online in-store and what’s happening in-store online. The data collected on a customer in-store, when combined with their online transactional and navigational history, allows advertisers to build 360° campaigns that engage the customer at each touchpoint during the purchase journey, both online and in-store (ROPO).

Promise vs reality

Similar to how online retail media was promoted, in-store retail media is touted as a strategic driver for retail growth by enhancing customer reach and sales. 

The key difference, however, is that the personalisation element that cookies, and now first-party data, have enabled for online, doesn’t yet exist in the same way in-store. In 2002, the film Minority Report gave us a glimpse of one potential future with Tom Cruise’s character bombarded with OOH personalised Guinness and Lexus ads based on real-time retinal scans. While data privacy makes that future unlikely, retailers are finding increasingly innovative ways to target shoppers with relevant advertising. 

Brands are looking for new ways to cover the different stages of the marketing funnel. Whereas before, advertisers relied on data solely to target consumers at the point of purchase, the variety of data available now allows advertisers to target the top of the funnel with relevant in-store advertising. 

For now, we’re seeing incremental steps towards personalised in-store advertising (1-to-some rather than 1-to-one). For Blandine Multrier, relevanC’s Managing Director of retail media, 1-to-some compliments perfectly the 1-2-1 online relationship brands already have with their customers.

"We are seeing incremental experimentations towards personalising in-store advertising. This allows brands to have an opportunity to deliver a specific message to shoppers based on data in-store. We can now map anonymised traffic patterns throughout the store either through passive wifi, cameras, or trolley location. So we can be confident about screen placement and content based on time and day of the week and see the effect at the checkout very quickly. In short, it’s the insights derived from this data make the potential of in-store retail media so compelling”

Meanwhile, technology capable of identifying the shopper and serving hyper-personalised content, while protecting privacy, is coming onstream. Tesco in the UK recently rolled out personalised advertising on the screen Scan as you shop handheld scanners, making the connection between loyalty card members, their path through the store, dwell times, and their purchase history to offer the ads with the highest chance of converting. 

What are the technologies Driving In-Store Retail Media?

The technologies available to retailers are diverse and evolving quickly. The technology required can be split into three broad categories: in-store display, in-store data collection, and back-end integrations. As we’ve discussed above, the foundation upon which in-store retail media is built is the data that can be collected in the store, which is what we’re focusing on here:

Connected digital signage is the starting point for in-store retail media delivery. Digital displays integrate easily into programmatic campaigns as they can be dynamically updated according to the campaign requirements. Beyond passive screens, integrating two-way customer interaction - via QR codes or touch -  is the next stage of evolution. If shoppers can engage directly with in-store advertising, they generate additional data points that underpin the monetisation of in-store advertising inventories. With more in-depth data collected, campaigns can be customised to maximise returns, and the easier it is to demonstrate ROAS for brands. 

GDPR and other data protection frameworks present serious challenges for retailers looking to understand shopper behaviour and then correlate that with target advertising. However, the technology for understanding shopper behaviour at a slightly less granular level exists and is evolving quickly especially where supported by AI. When looking at the placement of digital display assets, a retailer needs to know what’s happening across the store at different times across the week in order to optimise a brand’s exposure. Companies such as V-count and Advertima offer solutions that can track the flow of shoppers and that use AI to determine a customer’s demographic (age and gender) without infringing on privacy. Other solutions geolocalise shopping baskets and trolleys across the store and provide contextualised targeting. For instance, Instacart is currently piloting AI-powered smart carts which display personalised ads on a screen based on the last product placed in the cart

The benefit of this approach is that the journey through the store can then be reliably linked with what’s happening at the checkout, thus adding a level of data granularity and even closing the reporting loop on a 360 campaign. "We see very interesting innovations in in-store retail media" says Multrier. "But in order for them to scale, controlling cost and technical complexity will be critical. However, this shouldn't prevent retailers and brands from experimenting. Giving the advertisers the possibility to target customers in a meaningful way at each touch point while measuring the impact of each of these interactions will significantly increase the value of in-store retail media".

Grasping the opportunity

The potential advantages of in-store retail media are clear, both for retailers and advertisers. However, realising these benefits requires a forward-thinking approach and a willingness to invest in new technologies. Based on the insights from this article, here are three recommendations for retailers considering this investment:

Prioritise data: The key to successful in-store retail media lies in collecting and using data effectively. Retailers should prioritise solutions that allow for the collection of rich, meaningful data about customer behaviours and preferences.

Invest in technology: The technologies that enable in-store retail media are evolving rapidly. Retailers should be prepared to invest strategically in digital display technology, data collection tools, and backend integrations. Make sure that the technology you choose for in-store integrates seamlessly with the online retail media architecture you already have.

Think customer-first: Ultimately, the success of in-store retail media will depend on its ability to enhance the customer experience. Retailers should focus on delivering personalized, relevant content that resonates with their customers.

Give advertisers the best possible media buying experience. Help them to optimize their investment by offering 360 online and offline campaigns. 

Embracing in-store retail media is not just about keeping pace with the competition—it's about seizing an opportunity to better understand and engage with customers, drive sales, and create a more compelling in-store experience.

About relevanC

relevanC helps Groupe Casino retailers and their partners better manage and monetise their data. relevanC aims to provide them with a competitive advantage in three areas: hyper-personalised shopping experience for customers;  operational efficiencies, and monetisation of first-party data. We fulfill this mission by driving retail data innovation in four complementary fields:

• generating insights for suppliers
• retail media
• omnichannel customer activation
• development of AI-based personalised promotion technologies.

We play a pivotal role in developing and structuring our customers' Retail Media business by introducing new services, fostering partnerships, and exploring new markets. Our unique value proposition lies in promoting synergies between GPA Ads, Exito Media, and Infinity Advertising, addressing strategic needs, and collaborating on measurement and segmentation initiatives. We achieve this by making dedicated teams, advanced tools, and internal solutions readily available to stand out in the competitive advertising landscape.

relevanC operates in France, Brazil, and Colombia.

William Brown