If 2023 had a media buzzword it would be “Retail Media Networks”, or RMNs for short. Retail Media Network news seemed to explode everywhere last year. But what exactly is an RMN and what’s all the hype about?
Retail Media Networks are not new. Amazon debuted the first RMN over a decade ago and all the big retail players, including Target and Walmart, seem to have their own RMNs. But recently, regional retailers and service providers, like Uber, have debuted their own RMN.
In short, a Retail Media Network is a retailer-owned advertising service that allows marketers to purchase advertising space across all digital assets owned by a retail business, using the retailer's first-party data to connect with shoppers throughout their buying journey. Advertising opportunities include space on the retailer’s websites and apps. Additionally, RMN can include space within a retailer’s store, such as video screens at the checkout or deli, in-store audio, and even digital screens on freezer case doors. Some RMNs go even further to connect their first-party customer data to non-affiliated off-site digital properties.
In the advertising industry, Retail Media Networks are a win-win situation for retailers and advertisers alike. In a time of increasing costs and decreasing margins, RMNs allows retailers to profit from a previously untapped revenue source by selling advertising space everywhere from in their physical stores to on their owned digital platforms and to capitalize on their vast first-party data resources. Meanwhile, advertisers can utilize this first-party data and can “speak” to consumers in a forum almost as close to the point of purchase as you can get.
Retail Media Network advertising has been described as the “third big wave in digital advertising” after SEO and Social Media advertising. In the US, retail media ad spending increased from $13.2 billion in 2019 to an expected $55.3 Billion in 2024. That’s not surprising as The Mars Agency recently declared: “Retail media is now almost universally recognized as one of the most effective methods of commerce marketing.” Its astronomical rise in media spending is due to a fundamental shift in media planning methodology. In the past media plans were optimized for impression delivery. What gives RMNs the leg up is their first-party data and their ability to draw a direct correlation between impression delivery and SKU-level sales, thus, focusing more on transactional results than impression delivery.
Depending on your product and marketing direction, including Retail Media Networks in your advertising media plan could be an efficient way to meet your goals. If you want to know more about how to incorporate RMNs in your media plan or whether RMNs are even the right tool for you at all, give A3 Media a call. We would be happy to discuss the pros and cons of RMNs about your unique product and goals with you.