Grocers are facing increasing difficulties when it comes to maintaining profitability. The pandemic-driven shift to online shopping moved the centre of gravity for a lot of consumers. Many supermarkets now offer online shopping as an option, but online groceries bring lower profits than in-store shopping, and independent grocers struggle to make inroads against giants like Amazon.
At the same time, inflation and post-Brexit economics have caused food prices to skyrocket, leading consumers to cut their spending.
Against this backdrop, retailers are opening up another revenue stream by entering the new field of retail media. The potential is undeniable: Bain predicts that the retail media market will be worth $61 billion by 2024, or double its 2021 value. Meanwhile, McKinsey reports that 73% of advertisers plan to spend more on retail media networks (RMNs) in the next 12 months.
While much of the conversation around retail media focuses on ecommerce channels, in-store advertising is emerging as a powerful segment and an important part of the digital media mix. It offers audiences that are 70% larger, on average, than digital-only audiences.
According to a Mood Media survey, inspirational, informational, and atmospheric content on in-store digital screens is important for 56% of UK shoppers. Advertisers are increasingly realising the greater impact of ads close to the point of purchase.
As a result, in-store retail media offers a lot of promise for grocers, and it’s important to keep an eye on the trends within this vertical. Here is what grocers can expect and prepare for to make the most of in-store retail media.
Personalise in-store ads
Grocers already know that personalisation is vital for successful marketing. It’s time to apply it to in-store retail media experiences as well. Mood Media reports that personalised experiences have the highest impact on purchasing decisions, with 35% of consumers deciding to make a purchase in response.
Smart cart solutions like Shopic can deliver targeted offers to the right shopper at the right time, through the touchscreen interface that attaches to the trolley and scans shopper purchases.
Shopic’s retail media solution can anonymously identify the shopper’s location in the store and surface special offer promotions for the product on the shelf right next to them. If the grocer has enabled the system’s login sync with a loyalty program, the retail media engine can also pick up on consumer preferences to push discounts for their favourite products.
Enable full transparency
To succeed at in-store advertising, grocers need to retain the transparency of digital media, while combining it with the immediacy of in-store advertising close to the point of purchase.
Reporting insights with brand-side stakeholders is key to the appeal and success of digital retail media, helping it stand in stark contrast to traditional marketing as a means to strengthening partnership relationships.
Greater measurement accuracy is a key concern for ad media buyers at 88% of CPG firms, so grocers need to set up a system like CitrusAd’s GroceryOne that makes it easy to track and share data. GroceryOne removes friction from advertising collaborations, so that retailers can offer brands full visibility into campaign results, conversions, ROI and meaningful customer insights.
Raise the standard for creative
Creative and messaging will be an overriding theme in UK media next year. Mood Media found that engaging digital content has the second-highest impact on purchase decisions. Grocers may need to partner with expert marketers or employ specific in-house content to deploy storytelling, messaging, animation, and short video clips that convey engaging content.
At the same time, retailers need to get more creative about where and how consumers encounter this content, such as adding more digital signage, video walls, smart carts, and making use of refrigerator and freezer doors. Tesco recently announced that they’re expanding in-store digital screen network to 150 stores to show more appealing animations and visuals.
Companies like Cooler Screens turn freezer and fridge doors and endcaps into digital screens. GroceryTV’s system is also increasing its digital screen footprint across more locations.
Deliver on data
For grocers, data is your biggest treasure. Brands are attempting to navigate in a cookie-free world, and desperately need the visibility that grocery data can provide.
Loyalty program data can be a major differentiator. Especially given that the loss of third-party cookies is so alarming to digital advertisers, first-party data is now a significant driver for media monetisation.
Valuable data comes in many forms, including loyalty program data, in-store shopper data, footfall data, online shopping data, and more, and grocers need to leverage all of them to form successful retail media partnerships. Platforms like Advendio enable retailers to gather, prepare, and monetise their data, and make it easily accessible to their advertising partners.
Climb the learning curve
As mentioned above, in-store retail media is potentially valuable, but there’s no hiding from the fact that it can be challenging and difficult to succeed. Advertisers are highly results-focused and the market is very competitive. In the past year, 27% of advertisers moved from one retail media network to another, so there are no second chances to deliver winning results.
It doesn’t help that grocers are competing with experienced media providers while still learning the ropes of a new sector. The pace of innovation in retail media is extremely fast, moving at the speed of media, not the speed of retail, and an estimated three times the speed of ecommerce, which is way beyond anything grocers are accustomed to.
Grocers need to lay the groundwork to support in-store retail media, and to do it fast. It’s vital to hire the right talent, ensure that everyone in the organisation understands the conceptualisation of digital media, and upgrade tech. Supportive all-in-one platforms like the In-Store Marketplace give retailers the tools to keep up with the pace of change, making it easy to integrate media placements with demand-side platforms.
Grocers can benefit from the promise of in-store retail media
As the grocery sector continues to innovate, retail media offers a golden opportunity to expand revenue streams and add some breathing room to profit margins. However, it’s not going to be an easy ride. Grocers that want to succeed need to move fast, acquire the right skills and tools, and keep on top of retail media trends to deliver the performance and experience that advertisers seek.
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