RE:Made: The next wave of retail media players are coming; The silos are going
Colin Lewis on the end of retail silos; Q&A with Zitcha founder Troy Townsend; Exclusive Australian findings from Citrus's report
Welcome to the latest edition of the RE:Made newsletter, sister publication to our RE:Made conference, where the retail media community comes together.
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Each edition of RE:Made includes a monthly Q&A with a key player in the retail media space. This month’s guest is Troy Townsend, CEO of Zitcha.
Exclusive to RE:Made in this edition, we have the Australian findings from the largest global study of retailers and brands on the state of retail media from Epsilon and Citrus Ad.
And this month’s column from retail media evangelist and global consultant Colin Lewis explains the origins of the budget silo, and how retail media is smashing down the walls between budgets and departments.
RE:Made is where Australia’s retail media community comes together. Tickets are now on sale for the next RE:Made conference on Wednesday October 11. Book before August 14 and save.
Q&A: Zitcha’s Troy Townsend on getting the flywheel to turn
Since we saw you at RE:Made in March, what has changed?
Coles is doing really well, driving growth to match the likes of Cartology.
We are also going to start to see some new players entering the space. There is a lot of movement happening with larger retailers who are setting up their networks. Early in the next financial year, we will start to see more announcements of retailers who are well on the road to launching.
From a brand advertiser perspective, both brands and agencies are really getting up to speed about what role they play, and the value that retail media has for them. We're starting to see a lot more case studies come out detailing their success
What do you see as being the next focus area for the industry?
In-store. Digital in-store screens - more and more of these are being installed and incorporated. In-store audio will also be the low-hanging fruit. But also I see a lot of retailers getting clear on what they're doing with that flywheel - utilising their in-store, offsite and onsite media.
Their offer will be all-inclusive. For offsite, programmatic etc, The Trade Desk, Meta and Google are developing a clear view of what they will be doing in Retail Media.
So we're going to start to see a lot more focus on in-store and off-site over the next six to 12 months. In Australia, there's a heap of retailers also still trying to get their on-site right too.
What are you most excited about?
The Retail Media space will erupt based on value. So, I’m very proud of our Return on Advertising Spend (ROAS) delivered through Zitcha. The value that brands are getting across every channel is astonishing. We're starting to compare that across retailers who are running on-site campaigns. We're setting benchmarks. The value that a brand gets buying on-site is pretty eye-opening, including a massive return on extension channels, like Facebook and Google. Having benchmarks for brands running campaigns themselves versus running them through retailers tells an impressive story.
We're about to launch onsite Brand Pages into Zitcha, which will be a nice addition. We've built a platform that expertly drives traffic to e-commerce and into stores. Brand Pages will be an excellent connection point for brands to run promotions and always-on campaigns outside of Sponsored Products. That, in addition to AI, will be exciting for our retailers and brands.
How do you see AI impacting retail media?
We are starting to get clearer about how AI will enable better outcomes for Retail Media.
Thinking about innovation in this space and the connection of retail media networks and data: AI will change that. The way creative is built, how Media Mix Modeling is conducted, how briefing is done. It's an exciting time to be in a very new space. This emerging game changer of AI will influence how we solve problems.
What recent book, TV show, film or idea changed the way you saw the world?
I'm watching Ted Lasso at the moment and I love his leadership and ability to have diversity in his thinking. I have taken this into my day-to-day life. I love Ted. He's a ripper and makes people feel good.
An idea that is changing the way I see the world: I have recently had some exposure to other executives to exchange ideas. This has me thinking about how to bring diverse layers of thinking into challenges. How do we bring different internal teams together to solve problems? And where should we bring in external parties that have different skill sets, to make sure that we're solving them through a broad lens over a very focused lens?
We welcome suggestions for future Q&A guests to cat@unmade.media
Did you see the first edition of the Unmade newsletter?:
Introducing the RE:Made retail media newsletter
Cat McGinn, curator of RE:Made - Retail Media Unmade writes: Welcome to a special edition of Unmade, in which we introduce our new monthly newsletter RE:Made. It’s a sister publication to our retail media event RE:Made. This first edition has gone to everybody who receives Unmade. However, you will need to opt in to receive future editions.
The silo-smashing journey from combat to cooperation
The rise of retail media will smash silos, writes marketer and global retail media specialist Colin Lewis in his regular column for RE:Made.
The retail world is on a journey which will move from the confrontation of buyers and suppliers to a joint approach between suppliers and retailers. Here’s how we’ll get there.
First, let’s discuss the distinctions between “shopper”, “trade” and “brand” budgets when it comes to Retail Media. Let's start at first principles: what do we mean by each term?
Trade budgets are used as an investment tool to influence the performance of suppliers at retailers. When P&G creates trade budgets for Walmart, the funds are used for in-store promotions, advertising, and slotting fees for shelf space and product placement.
Shopper marketing is about affecting shopper behaviour instore to generate purchase decisions. For example, P&G may use shopper data to develop targeted promotions or coupons that are designed to appeal to specific customer segments.
Brand budgets are to build and promote a brand - to enhance brand reputation and visibility to drive salience and consideration.
However, in practice, these budgets are often used in tandem, with activities that blur the lines between them.
For example, P&G may use trade funds to support in-store displays or other shopper marketing tactics that drive sales, while brand funds may be used to fund a sponsorship or event that raises the brand's visibility.
Hence why you could say these are problematic distinctions - in that the lines are barely visible.
Now let's transfer all this thinking into the world of Retail Media.
Retail media such as Sponsored Search affects shopper behaviour online to generate purchase decisions using data: the shopper searches for 'coffee,' generating a search ad that is sold for the highest bidder from a brand.
Retail Media such as sponsored display or email is the digital equivalent of end of aisle instore - which are often part of trade deals
So, the distinction between “shopper marketing”, “trade marketing” and “brand marketing” budgets are really about silos and legacy.
The objectives set for “shopper”, “trade” and “brand” are also different:
“Shopper” is about getting sales results now - creating 'cash flows' now.
“Trade marketing” is about keeping the retailer 'sweet' and adding value to a formal contract.
"Brand marketing" is about getting longer-term results and often using longer-term measures - creating future cashflows.
Retail Media smashes all this apart. Why have yet another team working on retail media when it can deliver everything that “shopper”, “trade” and “brand” budgets in one?
Why not have a proper joint business plan that has shopper, brand, insights, data, commercial, media specialists that oversee all channels to objectively & strategically plan investment - all wrapped in one agreement?
What does this look like?
Today -> a combative transaction between buyers and suppliers
Margin and volume discussions, siloed activations,
Supplier experience inconsistent by category
Deal / 'trading' driven
Tomorrow -> A jointly owned business plan between suppliers and retailers.
JBP-based omnichannel campaign plans
Omnichannel category activations
1st part party data-driven measurement
Consistent commercial experience across total business.
Disconnected customers and wasted opportunities: The state of retail media in Australia:
Seja Al Zaidi dives into the findings from a new study conducted by Epsilon and CitrusAd into the state of retail media. The Australian findings are exclusive to RE:Made.
Retail media is emerging as a highly personalised, profitable way to reach customers where they already are.
The Epsilon CitrusAd study surveyed 689 brands and retailers across 12 countries between January and March 2023.
A number of ways Australian advertisers and retailers can tap into the opportunity of retail media were identified. Several findings emerged that suggested that retailers are leaving money on the table with limited channel strategies.
A unified retail media network which entails both on-site and off-site advertising can bolster both brands’ and retailers’ access to eager shoppers. Only 29% of retailers in Australia are using off-site retail media as part of their monetisation strategy, while 46% are using on-site ads. That’s a whole lot of wasted opportunity when it comes to reaching customers across the open web.
The main challenge facing brands and advertisers in integrating an effective retail media strategy though, seems to be measurement - in Australia, inconsistent targeting (50%) and multiple contracts (38%) were the top two inefficiency drivers in establishing a retail media network.
Brands say that the most important metrics to them are return on ad spend and total sales; two metrics that can really be optimised if a more streamlined measurement process is cultivated in the retail media industry.
“Part of the appeal of a retailer launching a retail media network is the trove of valuable first-party data that they can then leverage to advertisers as a point of immense value in reaching their customers, which could be devalued if shared with competitors,” says Adam Skinner, chief technology officer at Citrus. “Most brands agree that their investment in retail media networks would increase if a list of standards is created.”
Measurement pitfalls are rife across the global retail media landscape, and the ramifications of that could be shoppers opting out due to over-messaging. Citrus/Epsilon emphasise the matter of muddying the customer experience by working with too many tech providers in establishing a retail media network.
“A large portion of advertisers work with five or more retail media networks – this poses a problem for advertisers in the standardisation of measurement and starts to build mistrust between the brand and the retailer due to the lack of transparency,” says Skinner.
64% of brands and retailers in Australia agree that retail media networks with multiple technology providers negatively impact consumers, by either reaching those who have already been messaged to or ones who don’t want to hear from a brand in the first place.
Cutting back on the number of tech providers can produce greater outcomes for everyone - retailers, brands and shoppers alike. When 38% of consumers say that they have experienced disjointed messaging or creative across tactics and channels, the need to heighten consistency, measurement and the ability to sequence messages is all the more pertinent.
Skinner provides an example of unification of channels:
“Cartology acquired DOOH network, Shopper, late last year, and it is starting to look to Shopper’s screen network to offer advertisers outstanding retail context and proximity to Woolworths stores. Woolworths are seeing strong organic growth in the digital assets, but they are still seeing customers return to store with an average of 5.7 visits per customer each month.”
The projected estimations for brand investment into retail media for the foreseeable future is a little meagre compared to what retailers are expecting. While almost two-thirds (63%) of retailers expect brand investments in their retail media network to increase over the next three years, just 43% of brands expected their spend to grow. There’s a bit of a disconnect here that will be critical for retailers to understand and manage in the years to come.
From Skinner’s perspective, the major opportunities for Australian retailers to unlock their media capabilities lie in several core tactics. When it comes to data, Skinner encourages retailers to start with off-site advertising to build traffic and quick wins.
“First-party data strategies will need evolving from short-term capturing of consented data, to building out long-term audiences that are consistently replenished that brands will want to target,” Skinner says.
“Embrace off-site programmatic advertising. A one-stop-shop is not only easier to manage, but also ensures seamless connectivity and optimisation between all retail media channels on-site, off-site and in-store.”
Focusing on inventory availability and advertiser experience, as well as fostering data collaboration is critical for retailers. “Brands want an easy-to-use retail media network with ample inventory—and retailers want to provide it. Data collaboration technologies, such as clean rooms can play a vital role in facilitating collaboration, activation and measurement with first-party data in a controlled and privacy-safe environment.”
RE:Made - Retail Media Unmade returns on October 11
Unmade’s retail media conference RE:Made will be back in its new calendar position of October 11. Tickets are already on sale
We are now accepting proposals for the conference program. If you have a case study, new research or perspective that would be valuable to the retail media community, please send it to cat@unmade.media, with “RE:Made proposal” in the subject line - and please be patient if we’re slow to respond, as our focus is also on our AI for media and marketing conference, humAIn | human creativity x AI which takes place on July 12.
