Revolutionizing Retail Media: Key Insights from IAB's In-Store Retail Media Report

The IAB’s latest collaboration, “Quantifying Retail Media In-Store Success: Measurement & Innovation", brings industry experts together and explores how the future of retail media will bring retailers back to their brick-and-mortar roots. 

The IAB’s recent 20-page report highlights the emergence of in-store retail media and champions omnichannel strategy by combining digital advertising and in-person shopping experiences.  Players like Amazon, Target, Best Buy, and Sam’s Club are already investing in these future-focused strategies, leveraging personalized ads, digital signage, and even AI-capabilities on their in-store digital properties. 

The potential benefits of in-store retail media are substantial. But blazing new trails also comes with its share of challenges. Addressing issues like measurement transparency and seamless data synchronization between online and offline platforms will become crucial for retailers in coming years. 

Let’s take a look at some of the key insights we took from this white paper. 

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Pros of in-store retail media 

The IAB report discusses abundant potential benefits of in-store retail media. Here are some of the key value-adds mentioned: 

• Retailers can gain new revenue streams. By enhancing customer engagement and leveraging data-driven marketing and merchandising, retailers can open new advertising revenue streams and deepen brand loyalty -- which could also boost their bottom line. 
• Retailers can foster strategic partnerships with suppliers and brands. By integrating branded experiences into the store environment, retailers can enhance their overall value proposition: stores become more than a place for errands. They also become a hub for discovery and brand interactions.
• Retailers can offer brands unique and engaging assets. Retailers can stand out from the crowd by offering advertisers more immersive ad placements. In-store retail media brings more interactive and eye-catching brand interactions than traditional shopper marketing.
• Retailers can boost awareness and in-store sales. New technology like smart screens, on-the-go video, and proximity-based media can create interaction points with shoppers throughout the buyer’s journey and meet shoppers at the point of sale. 
• Retailers can gain better customer insights. Robust customer insights are paramount for retailers looking to increase efficiency and improve inventory management. Retailers can swiftly adapt to market trends, decrease out of stock or overstock issues, and gain a competitive edge.
• Retailers can measure previously unmeasurable metrics. Now, with in-store retail media, physical stores can obtain crucial metrics like glance views and conversion rates. 
• Customers gain more personalized ad experiences. Retailers aren’t the only ones who benefit from in-store retail media. Better insights translate to more personalized, higher quality, or more relevant ad experiences for shoppers. 

"At the end of the day, like other digital channels, the goal is sale-based measurement for more accurate reporting and personalized shopping experiences -- a true win-win for retailers, brands, and shoppers." 
_{- Claire Wyatt, VP of Business Strategy & Marketing Science at Albertsons Media Collective}

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Challenges of in-store retail media 

While the pros far outweigh the cons, the report doesn’t shy away from discussing the challenges ahead for in-store retail media success. Some of the key challenges the report outlines include: 

• Measurement transparency. Retail media already has a measurement issue -- adding in-store retail media into the mix will heighten the need for measurement transparency over time. 

"In-store retail media must be as data driven as any other retail media channel in the retailer's portfolio. Retailers need to be laser-focused on always using their data to guide them in recommending and evaluating ad placement for any type of in-store retail media." 
_{- Matt O'Grady, President at dunnhumby}

• Proving ROI. In order to showcase the effectiveness of in-store retail media, retailers will need to isolate in-store retail media strategies from other factors and initiatives -- seasonality, trade spend, traditional shopper marketing, and RMN ad exposures to name a few. 
• Integration. Integrating diverse technologies to work cohesively is key to fully gain a comprehensive understanding of customer behavior. 
• Privacy and data sharing. Integrating shopper information while heeding privacy concerns will be a top priority for retailers, as maintaining a delicate balance between personalization and intrusion is paramount for in-store retail media success. 

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Who’s using in-store retail media? 

Many big name retailers are already investing in innovative in-store retail media. Here are just a few of the many notable examples mentioned by the IAB: 

‍Target

“Target is testing digital screens at the end of center aisles in its racetrack store layout to boost sales, with early results showing significant growth in item-level and total brand sales for products advertised on these screens.” 

‍Amazon

“Clients with a strong Amazon presence are supplementing their Search and Display strategies with walkway and in-aisle screens at Amazon Fresh locations,” noted Alex Vinci, VP of Global Commerce at Publicis. “This move is part of Amazon’s foray into brick-and-mortar retail, including Amazon Go stores.” 

‍Tesco

“Tesco’s ‘Scan as you Shop’ service, available to Clubcard holders, integrates digital advertising into the in-store shopping experience. It allows personalized ad targeting based on individual purchase history, addressing inefficiencies in traditional retail advertising. 

This system displays tailored full-screen banner ads, enhancing customer experience by providing relevant promotions. The outcome is a more effective advertising strategy with measurable impact on purchasing, marking a significant evolution in in-store customer engagement and personalized advertising.” 

‍Walmart & Kroger

"In-store technology, as seen in Cooler Screens at Kroger and Walmart's self-checkout, is a game-changer for team integration and collaborative efforts. It's not just about enhancing the customer journey; it's about forging personal connections at the point of purchase. 

“However, despite its potential for message congruence and recall, there's a gap in data synchronization and measuring real value,” said Riyaad Edoo, Executive Director of Commerce at Essence Mediacom, “We're advancing beyond just streamlined creative activations; we're striving to isolate their impact and quantify ROI."

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Conclusion: 2024 marks a shift in retail media with a focus on monetization and personalization

“As in-store retail media evolves, so must the metrics and frameworks for assessing its impact, moving beyond traditional sales metrics. The future lies in the effective integration of RMNs and omnichannel strategies, enhancing customer experience and providing invaluable insights for more efficient operations and increased profitability.” 

In conjunction with this report, IAB also launched the DOOH and In-Store Retail Media working group with an inaugural meeting set for February 7th, 2024. Click here for more information on how to join or here to download the full IAB report. 

For more information on how to start your retail media journey, get in touch with us today.