top of page
Blog_Header Picture.png
  • Writer's pictureChris Moore

Retail Media Networks Are a Work in Progress!

Laptop computer on counter showing retail media networks being a work in progress

The advertising buzzword for 2024 has to be Retail Media Networks. They’re all the rage right now…..or are they?

There are multiple factors that have to align for successful RMN advertising and a breakdown in any one of them may leave one, or more, of the parties feeling their efforts missed the mark. This could prove to be a costly expense for at least one of the players.

The three groups for RMN advertising to succeed:

  • The Retailer

  • The Brand

  • The Consumer

The benefits are clear. For most retailers they have a relatively new, and highly profitable revenue stream. Forrester reports on average the margins for RMNs range from 50-70%. Not too shabby for an industry with historically tight, generally single-digit, margins. In addition to this, retailers have the opportunity for increased consumer spending if done right.   

For brands, if not a homerun, it should at least be considered a solid triple. The potential for brands to develop stronger ties and being viewed in a more favorable light with a retailer could be perceived as invaluable to a brand. While endearing themselves to the retailer brands simultaneously increase visibility and engagement with consumers. Ads delivered utilizing the retailer’s first-party data at perhaps the most opportune time for advertising – while a consumer is shopping. And finally, the opportunity to measure the campaign’s effectiveness against a shopper vs. a typical demographic audience. The chart below indicates the highest engagement RMN ad sectors for consumers.

The ultimate success, whether RMN advertising or not, is still dependent on the consumer receptiveness to the message and/or brand offer.

For consumers, it’s the opportunity for a more personalized shopping experience, the experience consumers have been looking for and retailers have been trying to deliver for the past several years. The opportunity to save money on sale items, learn more about new or similar products based on interest, search, and past purchasing habits. However, personalization equals relevance in the eyes of the consumer, otherwise it’s not personalization, it’s targeting.

Despite all the hype, RMN options, excluding the typical in-store options; circulars, checkout dividers, signage, sampling and the like, have been primarily but not exclusively limited to search, app and website or email blasts. But as attention to the channel has taken hold and increased its relevance so have its options. Instore audio, video screens, ad-enabled cooler doors, checkout screens and smart shelf labels may only be the beginning. As continued dollars funnel through this channel additional in-store delivery methods are bound to increase as well.

This, however, as the saying goes, is where the plot thickens.

  • These highly profitable RMN dollars have inspired retailers to include out of store media in their RMN options, CTV and social media could prove to be the new “Wild West” of RMNs. It is true these out of store tactics can utilize retailers first party data, but that doesn’t guarantee success. Statistically, roughly 30% of a grocery retailer’s consumers are exclusive to the retailer, the balance frequent other retailers as well. In highly competitive areas competing retailers out of store tactics may target the same consumers with competing brand offers not only creating confusion but increase the chances of simultaneously inundating the consumer with exorbitant ad delivery. This, coupled with the potential for excess in-store ads may alienate consumers. The odds are unlikely that a consumer will change retailers because of an ad they receive, but too much of it could be an additional annoyance.

  • Additionally, this heightened RMN awareness has sparked smaller retailers as well as retailers in other categories to jump on the bandwagon. There are white label platforms at the ready for retailers lacking the resources or time to develop their own RMNs that could compare with larger more well-funded RMNs.

  • These challenges only add additional dimensions to the expense and lack of transparency brands have been leery of to date concerning RMN advertising.

Brands, and their RMN partners, may be best served treading lightly or find more accurate ways of analyzing RMN spends blended with the brand’s overall advertising plans. Any annoyance in today’s “Excessive Individualism” society could be the straw that broke the camel’s back for consumers loyal to the brand or the retailer.


About A3 Media

A3 transforms media from an expense into a smart investment. Since 1997, we have successfully helped regional businesses launch new products, expand into new markets and increase sales through media plans that make every dollar spent do more. Our clients include brands such as Yuengling and Ashley Furniture. For more information about how A3 Media can help your digital marketing efforts, please call A3 Media at (610) 631-5500.

bottom of page