On September 13th the IAB hosted their Connected Commerce Summit and the theme was “Retail Reimagined.” The summit coincided with the release of the “IAB/MRC Retail Media Measurement Guidelines.” The topics covered some of the industry’s biggest challenges like standardization, transparency, attribution as well as sustainability, consumer trust, and the balance between personalization and monetization. Speakers from across the industry provided unique perspectives on the channel and the enormous impact it has for brands and the potential to overtake linear TV investment. There was major consensus on the need for transparency and standards and if the Retail Media industry can come together on those two pieces, that paves the way for even more growth.
The summit concluded on an optimistic note, casting a spotlight on the future of commerce and offering a glimpse of tomorrow's innovations. We eagerly anticipate reconvening in the same room next year, reflecting on the obstacles surmounted during this 'retail renaissance' on our journey towards achieving greatness in retail media.
KEY TAKEWAYS:
The retail media landscape, specifically retail media networks, includes about 80 platforms to date so the time is right for the industry to come together and align on standards that will enable transactions and enable transparency. The theme of it’s time to let go of history and start building for the future was prevalent throughout the day.
First-party data and closed-loop measurement are the two biggest competitive advantages retail media has and what is fuelling the growth.
Consumer trust = transparency and every decision a retailer media network makes must go through that lens. Transparency will be the key to unlocking continued and incremental investment from brands. We all know that retail media comes at a premium, but you get a lot more (than traditional media investments) in terms of merchandising opportunities in-store. Being results and data focused is how marketers can justify investments. The media industry, and more specifically in commerce, has to drive more clarity, not confusion, around the business outcomes they claim they can deliver.
The theme of sustainability in digital media activation permeated the entire day's discussions. A striking statistic revealed that "a single digital ad campaign generating 1 million impressions is estimated to produce a carbon footprint equivalent to a round-trip flight from Boston to London" (Source: Scope 3). This seamlessly tied into the discussions on data and audience strategy. By effectively aligning these two components to engage the desired audience (knowing that retail media 1st-party data is precise enough for this task), you can achieve the same impact with fewer impressions and subsequently reduce the carbon footprint.
In-store retail is poised to be the next major frontier in retail media, and gleaning insights from a retailer's digital footprint is the most effective way to enhance the in-store experience. Notably, it was emphasized that the checkout experience can significantly influence a shopper's satisfaction during an in-store visit. Therefore, leveraging insights from your app or on-site engagement and applying them to brick-and-mortar settings can enhance customer sentiment and drive increased foot traffic to physical stores. The innovations introduced by Amazon with Amazon Go stores and the forthcoming national rollout of Sam's Club's Scan & Go mobile app serve as clear indicators of the direction in which the in-store experience is evolving, characterized by frictionless checkout.
“Good data is not big data. Good data is small/actionable data.” People want to see ads that resonate with the needs that they have. Great creativity CAN drive sales when data is harnessed astutely and swiftly. Take, for instance, Oreo's realization that consumers were favoring baked goods over their product Recognizing their inability to change this behavior, they shifted their focus to milk, a product with far-reaching consumption. Oreo ingeniously hacked the system by introducing a QR code on milk cartons, offering free Oreos as a reward. By linking the data to the desired outcome, Oreo delivered an exceptionally innovative and value-added experience.
NEW! Buzzword Alert: Distinct technology stacks for retail media networks, such as data clean rooms, can often be categorized under the term 'madtech,' which represents the fusion of advertising technology (ad-tech) and marketing technology (mar-tech).
We know that loyalty data is used to create a more personalized in-store and online experience, but it was also the precursor to retail media. While first-party data from retailers unlocks valuable insights to drive personalization, leveraging generative AI to create models can provide a new understanding of shoppers and lead to actionable insights more quickly. The humble receipt has now evolved into a strategic asset that can be used to glean deep insight into someone’s shopping behaviors and preferences.
During a breakout session, a participant raised a crucial query, asking, "Why are we suggesting these standards rather than enforcing them?" The room responded with resounding applause. Organizations like the IAB are actively striving to promote the adoption of these standards, and the MRC offers accreditations to ensure accountability but consistency in language can’t result in inconsistency of practice, and I believe the industry stands at a pivotal juncture, given the substantial growth potential for the advertising business.