A showcase of retail media's future
Welcome to a retail media-focused edition of Unmade to start the week.
Today: Our columnist Colin Lewis reports back from last week’s NRF ‘24, the annual gathering of the world’s biggest retail trade association, the National Retail Federation. And our Q&A guest is Richard Knott, ANZ GM of retail media data player InfoSum.
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When AI met retail media
In his regular column for REmade, global retail media consultant Colin Lewis shares his take on NRF 24, the world’s leading annual event for the retail industry which took place in New York last week.
A showcase of the fast arriving future of retail
The National Retail Federation's annual show took place in freezing conditions in the Jacob Javits Convention Centre, bustling with packed crowds and a myriad of floors with an incredible array of tech on display.
There were two dominant themes across the three days: the pervasive influence of AI, and retail media. Much of the floor space and presentations were about those two topics.
The event is now a truly global one. There were plenty of Australian accents, A random check of badges would see people from Japan, Brazil, Chile, France, Germany, Mexico or Italy. And not just one or two attendees: a presentation from Mercado Libre (the largest online marketplace in Latin America) talking about their retail media programme in just one country – Brazil- had about 1000 people in the hall – and about 80% of those were Brazilian.
Meanwhile, the big tech names dominated the six halls: AWS, Oracle, Microsoft, IBM, Google, Salesforce, SAP and Shopify. Retail is no longer just about retail – it’s a business dominated by technology.
Exhibitors showcased a plethora of solutions aimed at enhancing both the retailer and customer experiences. Forrester helpfully pointed out all the AI experiments being done by retailers.
AI Shopping Assistants, or ASAs were everywhere. Some of these solutions were spectacular, combining full 4k screen resolution with visuals of real people interacting with the shopper. One eye-catching vendor used the human-sized 4k screens to show make-up products in action – no more asking badly trained store assistants how to use a particular product.
Innovations that caught the eye
The event heralded a second coming for RFID, the radio frequency technology used to tag objects at close proximity.
The AWS booth showcased all their digital and in-store solutions to show how Amazon services including 'Buy with Prime' and 'Amazon Today' could be used by retailers. Amazon One enabled palm-based payments with added age verification for those over 21. This tech was also integrated into food ordering kiosks for quick loyalty card recognition. The updated Amazon Dash Cart, now with a product-locating map function, attracted attention. Additionally, AWS's renewed focus on RFID technology was evident, particularly in its use for apparel in 'Just Walk Out' Amazon settings, automatically billing customers as they exit the store.
Beacons and IOT
Internet of Things technology is getting a new lease of life in retail. Wiliot were showcasing a cheap Bluetooth beacon tag, small enough to fit on various items like food, pharmaceuticals, and clothing. This tiny, stamp-sized tag is powered by surrounding radio waves and, even though it has no battery, it is equipped with a processor and a radio for real-time tracking of items’ location and condition. All it needs to trigger it is a smartphone.
Accessing data from in-store video cameras is now AI-powered. One interesting technology was from Venvee: retailers can get a holistic view across all video devices and locations, using computer vision, spatial and AI to understand human behaviour in physical spaces. Using the existing in-store cameras, Venvee can collect the full in-store journey of each shopper individually, including precise pathing and action insights - without the use of biometric information or geolocation. The application can be used to also measure the impact of in-store retail media by tracking whether the shopper passed a particular product and if they purchased it later.
Retail Media at NRF
If AI was the number one theme across the three days of NRF, retail media was number two.
Sucharita Kodali, principal analyst at Forrester Research spoke onstage with Yael Cosset, chief information officer of Kroger - the US’s largest grocery chain - discussing the way retail media networks are now the industry standard” and how many retailers were spooling up retail media networks in the US.
Forrester was upfront about the issues with retail media networks, quoting interviews with retail media executives that revealed the data produced is often unavailable until weeks after it was collected “which doesn’t allow us to react as quickly as other channels.”
A full-day retail media conference was held immediately before the event – with most US retailers in attendance, as well as attendees from the UK, Australia, France and Brazil. A big focus was on how on how retail media is moving up the marketing funnel and into the store.
However, different retails are moving at different speeds with this.
As Andrew Lipsman of Media, Ads + Commerce pointed out onstage alongside senior execs from Walmart Connect and Walgreens Advertising: “In-store retail media is still in its early innings and will depend on retailers investing in store digitization before advertisers can put meaningful dollars against it. But retailers have clearly awoken to its potential and are now in active pursuit.”
Andrew also pointed out that “Streaming TV is finally ready for primetime in retail media. The streaming TV opportunity has been held back by several factors, including lack of available inventory, lack of familiarity with the ad buying process, and lack of integration between RMNs and ad-supported streaming TV content providers. That’s all changing, with much of the groundwork having been laid in 2023.”
Throughout the conference, a recurring theme was the evolving role of brick-and-mortar stores, shifting from basic shopper marketing to a more significant brand-building platform.
One example of this was cooler screens - digital visuals of products inside the fridges. They are high-definition, full-motion video on the freezer or cooler door's glass panel.
When you see them live in-store, they are very compelling – more than you would imagine. The screens have sensors that can detect the presence of a customer within two metres triggering the display screens. There are no cameras on the outside of the coolers, so no images are captured that can identify individuals. The technology is designed to help brands tap into the few seconds when shoppers are deciding what to buy – and for marketers, the displays give data about how many shoppers interacted with the technology, how long they were in front of the screen, and how often they opened the door.
Ryan Mayward, VP of retail media sales at Walmart Connect, emphasized this shift to instore during the panel with Andrew Lipsman: “Instore is a channel with broadcast-level scale.”
My biggest takeouts for Australian retailer and media networks:
AI + IOT + RFID = next-generation tracking and measurement
Bricks and mortar can be a brand-building tool
Digitisation of everything in-store is inevitable, not a fad.
Q&A: InfoSum’s Richard Knott on competing for brand spend
In each REmade newsletter, we feature a Q&A with a key player in the retail media space. Our guest today is Richard Knott - InfoSum’s ANZ General Manager. InfoSum offers data clean rooms to protect consumer privacy.
Whathas changed in retail media in Australia over the past year?
Retail media in Australia is beginning to shift into something beyond a simple rebrand of endemic trade spend - which has been around forever - into a meaningful and new marketing proposition worthy of excitement.
We’re starting to see the idea of the retail media network build-out, with the retailer at the hub alongside strong media and data solutions. Consequently, it's competing for brand marketing spend as well as maximising current trade marketing spend.
What do you see as being the next focus area for the industry?
As the retail media network builds out beyond the retailer across many other related parties, so will the opportunity for those parties to collaborate across their datasets. For example, retailers can match their data with a brand's customer data and the content consumption data from media partners. This will enable advertisers using retail media networks to collaborate across all of these datasets to build out their understanding of their consumers, then create segments, activate them across multiple media properties and then, through point of sale data, close the loop with sales measurement.
What are you most excited about in terms of future plans or innovation at work?
The gold star for us is the work we have achieved in the UK with the likes of Sainsbury’s Nectar360 and Tesco Dunnhumby. We recently published a case study where we measured the sales effect on multiple consumer packaged goods brands, using Sainsbury’s Nectar360 data to advertise on UK broadcaster Channel 4’s video on demand service. They achieved a 29% increase in average sales uplift across all brands, and a peak 122% uplift in sales for one of the brands. We’re looking forward to replicating this type of success with our partners here in Australia.
How do you see AI impacting retail media?
This depends upon your definition of AI, but we will certainly see the greater application of AI models to optimise creative production and delivery, provide placement optimisation and media mix modelling, all combined with the application of affinity and lookalike tools. All of that is imminent if not already here today from many providers, whereas deep learning, LLMs and anything more generative is a bit more over the horizon.
What recent book, TV show, film or idea changed the way you saw the world?
I recommend “The Dawn of Everything - A New History of Humanity”, by David Graiber and David Wengrow to everyone I meet. It’s one of those books that makes you stop and think on every page. It brilliantly refutes the grand narratives and assumptions of history and human impulse, and makes you realise nothing needs to be the way it is. Everything around us is contrived, so everything can be changed. This is both liberating and a bit scary.
Unmade will be back with more on Wednesday. In the meantime, don’t forget to make sure this year’s date for REmade - Retail Media Unmade - is in your diary. It returns on October 1, and tickets go on sale soon.
Have a great day.