Retail shopping behaviors are full of contradictions at the moment, and winning over the modern consumer is a complex task. Ecommerce, for example, continues to rise in popularity, but the majority (~53%) of consumers still shop in physical stores. Loyalty is in flux—yet the right offer from a preferred brand wins out over a lower price from a non-preferred one.
Understanding these nuances on a granular level and leveraging them on an omnichannel scale is paramount to retail success. That means brands need shopper data—and they need it fast. According to Trade Desk, the number of marketers who intend to use sales data very frequently is expected to nearly triple in the next year.
Retailers have a huge opportunity to help brands leverage that coveted shopper data through their retail media networks. These networks connect brands with the shopper insights and direct channels they need to find and retain customers. Seventy-four percent of brands have dedicated budgets for retail media networks, and according to McKinsey, retail media network growth could represent as much as $100 billion in ad spending by 2026. The operating margins for this form of advertising are also a thing of beauty, falling in the 50-70% range for successful networks, and this is mostly driven by onsite media.
But in order to deliver on the promise of the network – and reap the subsequent ROI – retailers need not only a heap of data but established mechanisms for turning that data into actionable insights.
Brands are paying for direct connections, not impressions
For brands, the goal of any retail media network is to harness rich data sets to better connect with consumers through relevant advertising. Sufficient data scale is critical to deliver on the ROAS that brands expect from their investments in these networks. Data in and of itself, however, doesn’t deliver the value brands are after.
Retailer first-party shopper data is appealing to brands because it promises a direct connection with the consumer – not a bunch of raw material they have to figure out what to do with. The increased expectations reflect a broader evolution within the world of media buys. Before, brands paid for impressions with the hope of a purchase. In the world of commerce media, brands expect to be able to close the transaction-level loop. For brands, success hinges on the right media buying strategy, measurement tools and real-time campaign optimization.
Gather data & create insights
So what does it take to create actionable insights of tangible value for brands? It’s all about distilling multiple touchpoints – like POS, website, customer service, billing, brick-and-mortar stores and more – to a singular view of a consumer. If you’re lacking in raw material, consider leveraging proprietary channels like email to capture more first-party data. This is also an excellent avenue for engaging audiences with specific interests, shopping habits or customer profiles, especially for smaller retailers.
Customer data platforms (CDP) are a good starting point for synthesizing all the sources and creating unified customer profiles. It’s important to keep in mind, however, that not all CDPs are created equal. If your CDP isn’t helping you translate raw data into insights on your customers and their purchase behaviors at a regular cadence, you’re probably not getting the right ROI.
Finally, consider enhancing your first-party holdings with second and third-party data, as well as identity resolution capabilities, to create the maximum number of attributes and ensure precise targeting.
The more insights, the more revenue-generating opportunities
When it comes to shopper insights, the more attributes you have at your disposal, the more personalized advertising strategies are available to you. Consider, for example:
- Cross-selling campaigns – Using SKU-level purchase histories, can you find opportunities to promote complementary products to select segments of your audience?
- Re-engagement campaigns – If you know the frequency or cadence of a certain purchase, you can identify lapsed customers and incentivize them to re-engage.
- Seasonal campaigns – Certain products have seasonal relevance to any consumer, but others are seasonal to specific segments – like baby items to new parents, for example.
- Other forms of personalization – Birthday offers. Membership anniversaries. It’s all about the special touches.
The more granular the insight, the more opportunities emerge to layer information and create relevant, timely offers to new and existing customers. We help our customers, for example, leverage over 300+ enriching demographic, socioeconomic and lifestyle attributes to drive personalized offers based on actual purchases, preferred items, frequency, price sensitivity, promotional history, daypart, and channel preferences via virtually any digital channel.
Start today with POS data
We can help you build unified, privacy-safe profiles of loyalty and non-loyalty customers with SKU-level purchase history and hundreds of enriching demographics, socioeconomic and lifestyle attributes that power analytics and targeted marketing. We do it by combining your Point of Sales (POS) data with bank transaction data, and our proprietary census of offline identity and behavior to identify the actual individual behind a credit/debit card transaction. Contact us today to find out more about how we can help you activate, expand and/or refine targeting and personalization for your retail media network.
Want to learn more about the current state of retail media networks, emerging challenges and how to bridge the gap on unknown shoppers? Check out our webinar with Progressive Grocer, “How Retailers and CPG Brands Can Win at Retail Media,” by clicking here.
