Retail Media Networks, popularly abbreviated as RMNs are a type of advertising platform that allows retailers to sell ad space on their digital channels to third-party brands. While it is a relatively new marketing channel for advertisers today, it has been picking pace rapidly. Cheil's Retail Director across the Middle East & Africa, Wang Junwen (Alex) shed light on how the growing footprint of retail media is going to affect brands today.
According to Mckinsey & Co., Retail Media Networks are attracting an increasing share of marketing budgets as brands shift spending to target consumers closer to the point of purchase. Over 73% of advertisers will spend more on this channel in the coming years.
In an exclusive interview, Communicate discusses the impact RMNs will have on improving brand experience with Wang Junwen (Alex), Retail Director at Cheil Middle East & Africa.
In image above: Wang Junwen (Alex), Retail Director at Cheil Middle East
How is the growing footprint of retail media going to affect the retail brand experience?
Retail media footprint is on the rise, and most brands are investing in it to ensure that they do not miss their share, as it’s a powerful channel that enables further attracting customers into the retail space and eventually leads to incremental sales. Brands are increasingly adopting techniques and reinventing their approach to in-store/out-of-store to deliver key promotional messaging, announce new flagship product launches, and offer vouchers for in-store redemptions. Brands understand the power of investing more in retail media to deliver add-on sales revenue; hence, the market will continue to grow.
In what ways can retailers leverage retail media to collect reliable data on their target consumer group while also converting them into loyal buyers?
Now retailers can leverage retail media to obtain more qualitative data, which they can use to segment customers into different profiles. This allows brands to tailor solutions, be it in-store or off-site, targeting specific audiences, further leading to efficient spending. Brands are also listening to consumer feedback, which they are using to improve customer satisfaction, increasing the chances of converting them into brand enthusiasts. Some brands are even going further and offering brand loyalists more benefits to keep them enticed.
Retail media networks attract a larger share of the advertising pie. How can advertisers retain that spend and grow it further?
Retailers can analyze the channels they are investing in and see what gives them a better return on investment. They can then shift the spending towards higher-performing retail media tools and reduce spending on lower-return ones. This is a continuous cycle that retailers can use to achieve organic growth.
With the ever-evolving landscape of commerce, what strategies and technologies can retailers tap into to drive personalized and effective buying experiences?
One strategy retailers can adopt is collaborating with other brands to tap into audiences they did not connect with earlier, expanding their market reach. Partnerships can help brands offer bespoke experiences, catering to niche audiences, and driving a more personalized experience. Retailers can use personalized apps and build seamless brand journeys to drive purchase decisions. Retailers can also create bespoke experience zones within their stores that can deliver the same experience, maximizing their footprint in personalized marketing.
What are most likely going to be the top trends for retailers for 2024?
It is probable that brands will shift from a direct product-selling approach to a more subtle and engaging strategy, focusing on creating an easy-to-understand experience that highlights the benefits of using the product. Additionally, a growing number of retailers are likely to embrace a lifestyle-oriented approach to navigate through information overload, simplifying the consumer journey. This shift aims to move away from consumers merely attempting to comprehend product specifications to offering them a more hands-on experience of the product benefits.
How is the post-pandemic supply chain going to affect retailers in the coming years?
Even though supply chain management is slowly and steadily returning to pre-COVID levels, most retailers have learned from it and are taking a more learned and balanced approach. They are negotiating on prices, deliveries, and quality of products, and trying to ensure healthy and sustainable levels of product stocks.
How is the definition of brand experience evolving for retailers in the age of Web3 and AI?
Retailers are not outrightly jumping onto the bandwagon of delving into Web3 and AI just yet. This requires a lot of investment; hence, they are studying and analyzing the need to redefine their approach in the digital world.