Understanding Retail Media: The Marketer’s Guide to the Future of Shopping
Arsenal FC’s Emirates Stadium was where I had the pleasure of sitting on a retail media panel at a Savant Events conference recently. I’ve put together a few thoughts on the back of that session
Retail media is having its moment. Once a niche concern reserved for grocery store shelf placements and coupon flyers, it has evolved into one of the most powerful marketing ecosystems, blending digital precision with real-world consumer behaviour.
For marketers, retail media offers an unparalleled opportunity: the ability to reach consumers at the exact moment they are making purchasing decisions. But what does retail media really mean, and how can brands and retailers make the most of it? Let’s break it down.
What is Retail Media?
Retail media refers to advertising that takes place within a retailer’s owned platforms—both digital and physical. This includes:
- In-store advertising: Digital signage, shelf displays, printed POS, sampling stations, and even shopping cart placements.
- Onsite digital media: Sponsored product ads, homepage banners, personalised search results, and digital coupons within a retailer’s website or app.
- Offsite digital media: Retailer data-powered advertising on social media, search engines, and third-party websites.
At its core, retail media is a powerful fusion of first-party shopper data, highly contextual placements, and the ability to close the loop between ad exposure and actual purchase behaviour. However, it is crucial that these activations do not disrupt the customer experience. When implemented correctly, retail media should feel seamless and helpful rather than intrusive.
Why is Retail Media So Important?
1. It Targets Consumers at the Right Moment
Unlike traditional digital advertising, which competes for consumer attention across the vast open web, retail media reaches shoppers when they are actively looking to buy. Whether they are browsing an online grocery store or walking down an aisle, ads are placed in front of them at the most relevant time.
2. It Leverages First-Party Data
With privacy regulations tightening and third-party cookies on the way out, retailers’ vast troves of first-party data—derived from loyalty programs, online behaviours, and purchase history—are a goldmine for precise targeting.
3. It Provides Measurable Results
Traditional digital advertising often struggles to directly link ad spend to sales. Retail media, however, offers closed-loop measurement, meaning brands can track the direct impact of their campaigns on purchases.
4. It Balances Relevance with Customer Experience
A successful retail media strategy prioritises personalisation while ensuring that customer interactions remain smooth and intuitive. Over-personalisation or intrusive advertising can create friction, so brands must carefully craft their media strategies to enhance, not interrupt, the customer journey.
Retail Media in Action: Use Cases
So, how does retail media actually work in practice? Let’s look at a few scenarios.
1. Personalised Cross-Selling at Checkout
Imagine a shopper scanning a four-pack of Guinness into their supermarket app. Based on past purchase behaviour, the app recognises that this customer occasionally buys whiskey. Almost instantly, they receive a personalised offer for a discounted bottle of premium Diageo whiskey. This is retail media in action—using real-time data to drive incremental sales while ensuring the offer remains relevant and non-intrusive.
2. Sponsored Search and Digital Shelf Positioning
Online grocery platforms have become the new supermarket shelf. When a shopper searches for ‘protein powder’ on a retailer’s website, a brand like Optimum Nutrition can bid for its product to appear at the top of the results. This ensures higher visibility and, consequently, a greater chance of conversion without interfering with the shopper’s browsing experience.
3. Offsite Targeting Using Retailer Data
A shopper browses an online supermarket but doesn’t complete their purchase. With retail media’s offsite capabilities, the retailer can serve them a reminder ad for the exact products they viewed—whether on Facebook, Instagram, or the open web—driving them back to complete their purchase without overwhelming them with too many touchpoints.
4. In-Store Digital Signage with Real-Time Offers
A customer walks past the yogurt aisle in a supermarket, and a digital screen flashes a special offer on a new probiotic yogurt. If the customer has a loyalty account with the retailer, they might even receive a personalised discount based on their purchase history. This approach ensures offers feel helpful and timely rather than forced or irrelevant.
5. Direct-to-Customer Brand Funded Incentives
A major coffee brand wants to drive trial of its new espresso pods. Rather than a broad, generic discount campaign, it works with a retailer to fund a personalised incentive program, offering special discounts to customers who have bought similar products but haven’t yet tried the new pods. This type of targeting increases conversion rates while keeping the shopping experience frictionless.
The Future of Retail Media
Retail media isn’t just about selling ad space—it’s about creating a seamless, intelligent shopping experience that benefits brands, retailers, and most importantly, customers. As technology advances, we’ll see:
- AI-powered personalisation: From conversational AI shopping assistants to dynamic product recommendations tailored to individual buying habits, ensuring customers only see offers that add value to their shopping journey.
- Seamless online-to-offline integration: Digital and in-store media will work in tandem, ensuring consistency across the entire shopping journey without disrupting the customer experience.
- Retailers as full-scale media companies: As retail media networks grow, they’ll rival traditional digital ad platforms in both scale and sophistication, offering brands a new way to connect with high-intent shoppers.
Final Thoughts
For marketers, retail media presents an incredible opportunity to engage consumers in a more precise, impactful way. Whether you’re a brand looking to drive sales, a retailer seeking to monetise your assets, or an agency optimising client campaigns, understanding and leveraging retail media is no longer optional—it’s essential.
The key to success? Aligning retail media efforts with customer needs, ensuring ads are relevant, timely, and genuinely enhance the shopping experience without causing friction. Personalisation plays a pivotal role, but it must be balanced with a seamless customer journey.
Oh! Did I mention data? Get that right, and retail media will become one of the most effective tools in your marketing arsenal.
(did you like how I started and ended the piece with the same word?)