Omnichannel, omnishambles; Retail media outlook for 2025; Seven West Media hits new low point
Welcome to a midweek edition of Unmade, with our monthly focus on retail media. Today, columnist Colin Lewis attempts to connect the digital world to the cash register, and we ask members of the REmade community to look ahead to 2025. And further down, Seven West Media hits an all-time low on the Unmade Index.
Our retail media conference REmade returns next year. The most cost effective way of attending Unmade’s events is through an annual membership. Your $650 entitles you to a complimentary ticket to all of Unmade’s events, including REmade, HumAIn, Unlock, and Compass.
Your membership also entitles you to member-only content and access to our paywalled archives, and your own copy of Media Unmade.
And until the end of next week, every new annual member is also entitled to a $50 gift voucher of their choice, or a donation to UnLtd. on your behalf.
Avoiding the omnishambles of omnichannel
Our columnist Colin Lewis argues that connecting customers who are researching online to their purchases in-store is vital for retail media
Back in October, IAB Europe published its Omnichannel Guide to Retail Media. Early in the report, it cut to the chase:
“The challenge with omnichannel is the word ‘omnichannel’ itself. The word means different things to different people, and it means something different in every retailer or retail media network.”
For the world of retail media, “omnichannel” conjures up a MUCH bigger headache: connecting datasets to track whether shoppers research products online before they then purchase them in-store
There are two fancy phrases used in the marketing literature that take opposite approaches to the word omnichannel to explain the challenge:
One is ‘showrooming’, the trend in shopping behaviour where consumers visit physical stores to touch and feel the products, but opt to purchase them online. The other is ‘ROPO’ (research online, purchase offline) when consumers research products online before purchasing them in-store.
Traditional marketing metrics of success often overlook the ROPO effect.
Most current measurement models focus only on on-site purchases, ignoring subsequent off-site behaviour.
Quantifying the extent of off-site purchase behaviour allows both retailers and advertisers to better understand the impact of their retail media ads, allocate media budgets effectively, and make informed brand growth decisions.
Solving the ROPO challenge is critical for maximising the value of retail media.
There are plenty of peer-reviewed papers in marketing journals on the impact of the ROPO effect. Koen Pauwels, Professor of Marketing at Northeastern University in Boston, points out that retail media offers two important benefits to marketers:
Discovery and decision mode: Consumers visiting retail websites are actively considering purchases, unlike users on social media or search platforms.
Full-funnel data: Retail media facilitates the integration of consumer behaviour across multiple ad exposures, turning the traditional 'funnel' into a 'cylinder' of conversion.
In a study for the International Journal of Research in Marketing snappily titled “The effectiveness of different forms of online advertising for purchase conversion in a multiple-channel attribution framework” Prof Pauwels observed that:
Retail media ads are more likely to be 'content-integrated', i.e. directly related to the main objective of the website's user.
In contrast, many non-retail media ads tend to be 'content-separated', i.e. they do not correspond to the user's main objective, which could be checking sports results, getting news, or connecting with friends and family.
Prof Pauwels suggests that content-integrated ads on retail media platforms are three times more effective at driving purchases than content-separated ads.
In a paper called “Amplifying Off-Site Purchases with On-Site Advertising”, Pauwels and his colleagues introduced two key metrics to measure ROPO. They combined Amazon internal data from customers’ browsing behaviour on Amazon.com and matched these with survey responses for the same customers about their offsite behaviour across 12 product categories.
Prof Pauwels and his colleagues created two brand-level measures to quantify the magnitude of off-site purchases among on-site researchers: ROPES (Research on-site purchases elsewhere share) and AR (amplifier ratio, a proxy for the amplification of return on ad spend by comparing on-site purchases to off-site purchases within the same category.
Prof Pauwels’ research was based on serious data sizes: they collected survey responses from 41,946 Amazon customers across ten categories in 2021 (Audio Speakers, Computer Printers, Doll Toys, Laptop Computers, Microwaves, Power Drills, Running Shoes, Smartphones, Tablet Computers, and Televisions).
Their papers showed that ROPO is “economically substantial”. Among the consumers who researched a product on Amazon, more end up buying it off-Amazon than on-Amazon - in every analysed category. In other words, off-site purchases often exceeded on-site purchases, with ROPES varying from 0.5% to 10% across categories. Doll toys, printers, and running shoes had higher ROPES than laptops or smartphones.
Moreover, consumers who visit more product pages, click more and spend a longer time on the product's Amazon page, are more likely to buy the product, both on and off Amazon.
PUpper funnel advertising like displayaAds, video ads or sponsored display ads tends to have a relatively larger share of off-site sales contribution relative to lower funnel advertising like sponsored products advertising that affects mainly on-site sales
They also found that always-on advertising strategies on Amazon showed greater impact on off-site purchase behaviour compared to time-limited campaigns.
So, what should we take on all of this real-world, peer-reviewed data as well as the Boots announcement?
There are seven takeaways here:
ROPO is measurable and important
Attribution models and data ingestion capabilities at campaign level can show that including online-only sales and offline sales improves return on advertising spend.
Amplification effects of media campaigns extend beyond the initial channel, influencing broader purchase behaviour.
There are sizable contributions of off-Amazon sales of 16%–44% for the different ad products across brands.
Upper-funnel and always-on campaigns drive greater off-site purchase contributions
“Always-on” spending reaches consumers at any stage in the customer journey whereas ‘bursting’ ads at certain points in time limits the number of potential customers the brand can interact with,
Retail media sites act as major “billboards” for off-site purchases, amplifying brand presence and driving cross-channel results
A look ahead to the retail media landscape in 2025
Cat McGinn, curator of REmade, writes:
We asked members of the REmade advisory panel for their predictions for the retail media sector over the year to come. As we move into 2025, the forces shaping the retail media landscape are converging around a critical theme: the evolution of data-driven strategies and the race to innovate. Whether it’s the growing dominance of first-party data, the rapid expansion of retail media networks, or the push for advanced measurement and AI-driven personalisation, the year ahead promises transformative shifts.
Jana Marle Zizkova, CEO & founder, Meiro:
“One of the major trends for 2025 will be an even bigger focus on first-party data. We see with our customers that first-party data addressability determines the ‘destiny’ of (that) business. Those organizations that focus on good Identity Resolution across all touchpoints of their customers, attempt to increase customer or visitor authentication, and proactively collect marketing consent, are going to be winning long term. Third-party cookies lost their activation ability regardless of Google shutting them down, The future is a first-party data-based strategy.”
Mohammad Heidari Far, managing director, Flywheel
“It’s been encouraging to see the uptick in the use of cleanrooms and transaction data to drive sales. We’ve been utilising clean room solutions like AMC to drive full funnel campaigns for many of our clients here at Flywheel and continue to extract insights as we’ve done in the past. This transition in the role of clean rooms from insight generation to activation has been a good learning for many of our clients.
“With more retail media networks coming to market and increased inventory from the current players, a key question for clients is budget allocation and focus. A key trend in 2025 will be solutions that address this need. In my view, it requires two things:
“The expertise in understanding strengths of each RMN and their assets in achieving specific client objectives
“Technology that enables assessing performance of media across different networks and asset types against said campaign objectives.”
Simon Porter, head of retail, Hatched
“For me, looking back at 2024 the pace of growth in interest in retail media has been really noticeable. Certainly the industry groups seem to be growing with new members every month. But the pace of innovation isn’t keeping up with the interest.
“Looking forward to 2025 there are a couple of trends we’ll see. Firstly, there are going to be numerous new retail media networks launched. I expect to see a number announced early in the new year, major household retailers among them. My guess is the number of retail media networks in Australia is going to be 3x what we see today. Which will lead to a bit of a reset as competition intensifies. Secondly, 2025 is going to see some genuine innovation in the space and we’ll see the first real strides in digitisation of in-store over and above the screens currently in play.”
Roger Dunn, Global retail media lead, Diageo
“In 2024 we've been focused on the 'metrics that matter,' aiming to move beyond basic metrics and ROAS, and move towards incrementality and long-term sales growth As AI eats the world, we've looked to experiment and adopt artificial intelligence to automate and personalise our messaging. We've learned to strengthen collaboration across teams, to ensure we have a view across all our retail media activity.
“In 2025, retail media will continue to grow offsite, with big advancements in CTV and video more broadly. Advanced measurement solutions will help bring greater accountability - but this will not just be delivered by retailers/platforms - brands will also have to work on their own measurement solutions that integrate across the broader marketing mix. Retail media will continue to expand outside traditional retailers and marketplaces, into new areas and pushing the limits of today’s nomenclature.”
Seven slumps
Tim Burrowes writes:
Shares in Seven West Media hit a new all-time low of 14c yesterday, sinking by 3.3% leaving the company with a market capitalisation of $223m.
After being overtaken in size by ARN Media, that gap widened yesterday, with SWM now $10m smaller.
Meanwhile Ooh Media sank by 2%.
The Unmade Index sank by 1.57% to land on 445.9 points.
Time to leave you to your Wednesday.
We’ll be back with an audio-led edition tomorrow in which we share highlights from the Adelaide edition of our Compass tour.
Have a great day.
Toodlepip…
Tim Burrowes
Publisher - Unmade
tim@unmade.media