Inconsistent targeting (43pc) and disparate reporting (41pc) across channels/tactics emerge as the primary drivers of inefficiency in retail media, according to Epsilon’s study of retailers and brands on the current and future state of retail media.
The research, conducted in partnership with Phronesis Partners, surveyed 689 mid-to-large sized brands and retailers across 12 countries between January 2023 and March 2023.
The survey sought to better understand brands’ and retailers’ perception of and approaches to retail media. In addition, respondents were asked to share what actions they have taken, or are planning to take, in their retail media strategies and offerings along with the key criteria used to evaluate retail media platforms.
Findings from the survey revealed that 64pc of respondents agree that retail media networks with multiple technology providers negatively impact the shoppers. Additionally, the study highlights concerns regarding data leakage and privacy, with 72pc of brands seeing it as a barrier to retail media adoption and 71pc of retailers perceiving it as a challenge to the growth and scaling of their retail media networks.
According to the survey, retailers are not fully capitalising on the potential of reaching shoppers across the open web (off-site retail media). Only 37pc retailers are currently utilising off-site channels for retail media monetisation. Furthermore, 42pc brands identified audience targeting customisation/accuracy as the primary barrier to adopting off-site retail media.
Additionally, the study indicated that brands prioritise the availability of easy-to-use retail media networks capable of reaching a larger number of in-market shoppers. 76pc respondents emphasised the importance of the quality of advertiser experience in retail media for their organisations. Moreover, 75pc participants identified the amount of inventory available as the most critical factor in retail media.
Data collaboration is highly valued by both brands and retailers, with 70pc of respondents acknowledging its importance in their advertising strategy. Furthermore, 47pc are actively developing data collaboration partnerships, while 37pc already have them in place.
Brands express a strong desire for their retail media partners to measure real performance and return on ad spend, with 70pc prioritising return on ad spend and total sales as the most important metrics, surpassing total reach and incremental reach.
“The consumer experience is too often overlooked in the retail media frenzy,” said Joe Doran, Chief Product Officer at Epsilon. “We’re so caught up in the hype around the latest offerings that we ignore the fact that fragmentation leads to poor advertising experiences and frustrated shoppers. We believe that solutions that focus on messaging individual shoppers across channels deliver better performance. Brands want to talk to existing and potential in-market shoppers. Retailers should facilitate those conversations at scale and across channels that can reach in-market shoppers wherever they may be in the consumer journey. So, when we put the individual shopper at the center of the advertising, everyone wins,” he added.
“Good technology is fundamental to good retail media. Brands and retailers must navigate a sea of constantly growing and changing retail media technology partners while responding to more volatile consumer behaviors,” said, Adam Skinner, managing director of retail media networks at CitrusAd. “It is exciting to see almost 700 retail media professionals have validated the path and strategy we have been on for years. Our unified platform offers brands an intuitive, easy to use interface backed with best-in-class technology that provides scale to reach in-market shoppers wherever they are on their journey – on-site or off-site across the open web,” he added.
