Retailers can give advertisers something both illusive and extremely lucrative: accurate, attributable, and immediately actionable data.
This year, over $140 billion will be spent on digital retail advertising globally.
Amazon likely captures more profit from its advertising services than through the fulfillment of products. Retail media is being hailed by many as a gold rush, and with these numbers, it is obvious why.
Many retailers are opening up their businesses to drive more opportunities to reach key audiences (and even more importantly key new revenue pools) through retail media advertising.
Seeing this gold rush, one could argue that a frontier that has yet to be fully explored and mined is the store itself. Since the end of the pandemic, online growth has plateaued, and still 93% of all retail dollars are spent in a physical store.
With their in-store offering, retailers can give advertisers something both illusive and extremely lucrative: accurate, attributable, and immediately actionable data on what drives a shopper conversion and how effective their advertising spend is.
In short, because retailers have precise data on in- store advertising and conversion, they can be the new hot digital media opportunity for brands to connect with consumers.
With 25 years of experience in-store working with seven of the top ten largest retailers in the world, our technology is ubiquitous to stores on almost every high street.
Many of our largest customers are in a continuous test and learn cycle, constantly optimizing their in-store retail media networks to enable new and larger revenue opportunities every day.
STRATACACHE technology gives retailers the power to build audiences based on real in-store shopping behavior.
Grocers, convenience stores, and high-value product categories such as beauty and electronics, are further on, and what we see in these retailers is incredibly exciting.
Using their deep pools of data achieved from in-store sensors and first-party data from sales capture and loyalty programmes, these retailers can fully drive full funnel attribution and use in-store displays as highly dynamic contextual media surfaces tailoring messaging to customers based on their interests and goals.
Empowered with AI, these smart store platforms deliver personalized shopper messaging at scale.
While retailers recognise that 93% of all sales occur in the store, the power of measuring activity in the aisles is still a new concept. Retailers using only e-commerce and transactional sales data operate with a sliver of the information that they could if measuring consumer behavior and action in-store.
In-store digital advertising is also a unique value as it avoids some of the largest pitfalls of online. FMCG brands know that 23% of all digital ad spending is expected to be lost to digital ad fraud this year, with over $84 billion lost last year.
Online programmatic is also quite murky when considering cost to brand vs. revenue to retailers, so it is clear why savvy advertisers appreciate the clarity and attributable nature of the data that in-store retail networks can provide.
From this data, campaigns can be created and honed in real-time to ensure campaign messaging is as compelling as possible, building brands and driving sales.
So, what is it about the data gained in the store that makes it so valuable? Scale, Opportunity and Profit. It is robust - based on real people in a physical space and the decisions that they make.
Using advanced sensors, which crucially do not rely on cameras due to privacy laws across territories, STRATACACHE technology provides anonymous shopper pathing, which can be tied back to loyalty or transaction data at the register by opt-in. This insight gives retailers the power to build audiences based on real in-store shopping behavior.
For example, retailers can see a shopper who lingered in the pet aisle of a store but did not make a purchase.
This information could prompt a retargeting campaign across streaming/CTV or mobile with a compelling offer to encourage immediate conversion online or during the next store visit.
With in-store analytics, brands can track impressions, engagement, conversion, and sales. This information is crucial for justifying advertising spend and securing future budgets.
These real-world behavioral data points along with existing first-party and sales data create a wealth of attributable information. With this information, retailers can work with brands to optimize promotional messages - changing where they appear, the formats that they take, as well as the artwork and language used.
With strong data, customers are targeted with contextualized media, that is, messages that are hyper- personalized to them based on a variety of factors that could include where a customer is in the funnel, their mindset at different times of the day and in different areas of the store or website, other contributing factors such as the weather, the results of a local sports team as well as crucial information that impacts shopper experience such as wait times and stock availability.
Tracking a store in this way opens up the ability to radically improve the shopping experience for shoppers while increasing product and category activation.
In addition to unlocking the retail media network capabilities of the physical store, using in-store sensors and the analytics derived from them also minimizes waste: the real-time status of perishable products can be known for discounting, wait times monitored, staff activity maximized, and shrink mitigated.
“With 25 years of experience in-store working with seven of the top ten largest retailers in the world, our technology is ubiquitous to stores on almost every high street.”
We call this the ‘Sentient Store,’ a shopping experience in a physical retail space where advanced sensors receive real-time dynamic data signals. At the same time, AI provides real-time and predictive knowledge of the store, the inventory, the shopper, and the journey, helping retailers identify opportunities for sustainable growth.
The delta between a digital out-of-home (DOOH) proposition and a true retail media network is data. Retailers using their premises and channels simply as a DOOH will never be competitive.
In charging merely for impressions or opportunities to see, retailers are missing out on the revenues that can be earned from the personalisation and responsive campaigns retail media networks provide.
Tracking and serving shoppers adaptive, relevant campaigns in-store and on their television and mobile screens is a capability that retailers have not had before. Those not exploring this new frontier will lose out not just to the likes of Amazon but also their bricks and mortar neighbors.
The insights to be unlocked, the efficiencies to be executed, and the opportunities to be unearthed through the data to be found in-store are precious. They will transform retail forever.
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This article first appeared in Retail Technology Innovation Hub
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