Katrina Smart
The IAB predicts the rapidly growing retail media industry in Europe will reach €25B by 2027. As the market continues to grow, and an increasing number of new retail media networks launch across Europe, the challenge to determine the best investment becomes even more complex. Although the European market is much more nascent than the US, retail media has already become a potent tool for brands to reach target audiences. By partnering with these networks, brands can tap into the retailer’s customer base, gain access to valuable insights, and deliver personalised and contextually relevant messages to shoppers that increase the chances of conversion at the point of purchase.
Why the European retail media market is expected grow like wildfire.
One of the key reasons for Retail Media Network’s (RMN) growing popularity is its ability to deliver highly relevant, first-party data-driven and targeted in-store offers. This is achieved through the collection and analysis of vast amounts of customer data, allowing retailers to tailor their advertising messages and promotions to individual shoppers. Another factor driving the adoption of RMNs is the rapid growth of ecommerce. As more and more consumers shop online, retailers are looking for ways to reach them with targeted ads directly on their websites and apps. RMNs act as a centralised platform that enables brands to place their ads on relevant product pages or in targeted email campaigns.
Retailers are also using RMNs to control the flow of products and manage their inventory more effectively. By leveraging their websites and apps as closed ecosystems, retailers can manipulate prices, highlight specific products, and offer targeted promotions, to optimize product movement and maximize sales. Moreover, RMNs enable contextually relevant, flexible, mutually beneficial, and creative brand partnerships around timely events (holidays, seasonal / sporting events, etc.). This collaborative approach enables brands and retailers to co-create campaigns that resonate with consumers and drive sales. RMNs also provide highly detailed performance measurement that brands and retailers find invaluable. This data-driven approach quantifies the effectiveness of campaigns and informs the optimisation of strategies to improve decisions about future investments.
In addition, RMNs represent a new, more retailer-controlled frontier that operates outside the existing macro ad model. This shift in power gives retailers more say in how their data is used and how their brands are represented, fostering a more collaborative and mutually beneficial relationship with their advertising partners.
Choosing the right partner.
Although retail media is a key player in the commerce marketer’s toolkit, it can be highly complex for brands to navigate the market. Among the frustrations we hear from clients are the many differences in capabilities, not only from one market to the next, but between each network. Key challenges also include:
- legacy structures internally make it hard for brands to plan holistically.
- language barriers across the vast European market force some to manage planning and tactics locally, rather than regionally.
- the lack of widely adopted standards in the measurement and insights that networks provide.
It is essential to understand as much as possible about each retail media network, so you can effectively plan and invest your marketing spend where you will achieve the best results. With the number of RMNs growing rapidly, knowing which is the right fit for your business can take time and effort. Here are some key factors to consider when choosing an RMN partner:
- Understand your goals and objectives. Before you start looking for an RMN partner, clearly defining your goals and objectives is essential. What do you want to achieve with retail media? Are you looking to increase brand awareness, drive website traffic, or generate sales? Once you know your goals, you can narrow your search to RMNs focusing on those specific areas.
- Assess the retailer’s reach and customer base. Understanding the size, scale and audiences of the retailer are essential factors to consider when choosing an RMN partner. You want to partner with an RMN that has a strong presence in the market you want to reach. Understanding the retailer’s customer base’s demographics and audience segmentation are essential to ensure they align with the target audience you are trying to reach.
- Evaluate the RMN’s data and analytics capabilities. The data and analytics capabilities of the RMN are essential for measuring and optimizing your campaigns. Make sure the RMN provides transparent reporting and access to critical data points. You should also be able to track your results across multiple channels, including the retailer’s website, app, and social media pages.
- Consider the RMN’s pricing and fees. Pricing can vary significantly between RMNs, so comparing rates and fees is important before signing on. Some RMNs charge based on CPM (cost per mille), while others charge based on CPC (cost per click) or CPA (cost per acquisition). When comparing pricing options, you should also factor in the price of creative development and campaign management.
- Evaluate the RMN’s technology and platform. The technology and platform of the RMN should be user-friendly and easy to integrate with your existing marketing stack. Ensure the platform provides the features and capabilities you need to create effective campaigns. You should also be able to easily measure and optimize your campaigns using the platform’s reporting tools.
- Research the RMN’s reputation and track record. It’s essential to research the RMN’s reputation and track record before partnering with them. Read reviews from other brands and agencies to understand their experience with the RMN. You should also check the RMN’s website and social media pages for testimonials and case studies.
- Consider the RMN’s support and customer service. A dedicated account management and support team is essential when partnering with an RMN. Ensure the RMN provides responsive and knowledgeable support to help you navigate the platform and troubleshoot any issues. You should also have easy access to customer support resources, such as FAQs and training.
- Test and learn. Work in collaboration with the RMN you are considering working with to understand its capabilities and performance during beta and trials to get ahead of the curve.
- Negotiate any Joint Business Planning and partnership agreements carefully. Make sure that any agreement is aligned to your business goals and will help to achieve the retail plans that you set out as part of your business and marketing plans. Look for added value within your commitments and align spend carefully to promotional periods, seasonal events, and category moments.
- Continuously monitor and evaluate performance. Once you’ve chosen an RMN partner, monitoring and assessing your performance is essential. Regularly review your campaign results and adjust as needed. We highly encourage keeping monthly, quarterly and annual planning with both the RMN and Retailer partners to drive true partnership.
In conclusion, RMNs offer a compelling set of benefits that are driving their widespread adoption. From highly targeted advertising to data-driven insights and flexible partnerships, RMNs are revolutionizing the way brands and retailers connect and convert with consumers at the point of purchase. As the retail landscape continues to evolve, RMNs are poised to play an even more significant role in shaping the future of digital advertising.
If you are interested in finding out more about the industry’s first-ever “European Retail Media Report Card”, visit https://www.themarsagency.com/post/retail-media-report-card-europe/
ABOUT THE AUTHOR
Katrina Smart, Commerce Media Director for Europe at The Mars Agency
Katrina Smart is Commerce Media Director for Europe at The Mars Agency The Mars Agency is an award-winning, independently owned, global commerce marketing practice. With talent around the world, they connect people, technology and intelligence to make clients’ business better today than it was yesterday. Mars’ industry-leading MarTech platform, Marilyn®, helps marketers understand the total business impact of their commerce marketing, enabling them to make better decisions, create connected experiences and drive stronger results. Learn more at themarsagency.com and meetmarilyn.ai.