With the right customer data, audience access, and organizational commitment, consumer service providers can stake their own claim to media dollars
By Michele Roney, Retailer CX
No, you can’t technically operate a retail media network. But you can use the same foundational elements that empower retail media to build an advertising network of your own and get relevant advertisers in front of your customers. You can call it a commerce media network.
Let’s be clear, though. For retailers, staying firmly focused on their core “reason for being” when operating media networks remains absolutely critical to success. The game-changing strength of retail media is its ability to reach shoppers in relevant ways at opportune moments — fueled by robust first-party data about their behavior as well as direct methods of facilitating conversion. For brand partners, retail media networks also provide an unprecedented opportunity to align their marketing and merchandising initiatives in ways that also substantially benefit the retailer and its shoppers.
Those are essential elements that differentiate retailer-operated media networks from any other available advertising option. But whether you’re a grocery store, a hotel, or a financial institution, the most critical ingredient is that first-party customer data. That’s why launching a revenue-generating media network is a viable opportunity for any company with a strong, addressable database of insights into customer behavior.
Making Sure the Data Is Right
It’s not quite that simple, of course. First off, your customer data must have enough breadth and depth to make it leverageable for advertisers to identify and target their own relevant audiences. The emergence of data clean rooms could prove to be a great benefit in this area by helping advertisers find the commonality between their customers and yours.
You also need an audience with enough scale to compete with the largest networks or, more likely, some unique characteristics — lifestyle stage, social status, product needs, etc. — that advertisers can’t easily find elsewhere.
One exercise we conduct with our retailer clients is to consider what their business strategy would be if their vendor community wasn’t offering a ready-made advertiser base. Is their audience unique enough to make an above-the-line ad agency want to reach it? Is it large enough to facilitate targetable segments? What is your unique selling point? Without a distinctive audience, you’ll never break through the growing clutter of networks.
For non-retailers, it might even be a good idea to go beyond your existing data to find some of that uniqueness through customer research. What interests do customers have beyond your relationship, and what categories or brands might interest them? That information would help you build both an appropriate customer experience and a list of potential advertisers.
The Other Must-Haves
A data-driven audience is the entry ticket, but there are other best practices that also need to be addressed. And they begin with an organizational readiness to invest the time and resources needed to build a relevant, engaging experience for your customers and effective media opportunities for your advertisers.
We still encounter companies looking to enter the media arena before clearly understanding the significant investment that’s required in talent, technology, and other resources. You must be ready to build internally in the areas most critical to your strategy and find best-in-class external partners to handle the rest of the skill set.
Naturally, you also need to build an ecosystem that gives advertisers targetable and measurable opportunities to reach that unique audience you’re offering. And a robust inventory of owned & operated advertising opportunities that will enhance rather than interrupt the core customer experience by staying true to your brand promise and their needs. That involves relevant, personalized engagement.
Might a consumer making a hotel reservation be interested in ads from restaurants and tourist attractions near that location? Very likely. From destination-appropriate apparel and sporting goods brands? Quite possibly. From shampoos and bathroom tissue? Maybe, if they’ve just booked an extended stay and can get an order delivered free on arrival day. From an auto dealer? That’s probably pushing it — although a car rental company might be welcomed.
You also need to build (or borrow) self-service activation tools that make it extremely easy to buy media and build campaigns. Efficient interoperability with third-party platforms is important here, too.
Among the most important capabilities to develop is measurement. Retail media advertisers have become far more demanding about the precise metrics they need to evaluate performance — and far less tolerant of networks that can’t deliver. Here, you will need to act like retail media to find ways of measuring tangible business impact rather than just impressions and clicks.
Finally, be realistic about your potential by setting achievable expectations and the proper KPIs. Not all media networks are destined to become billion-dollar revenue generators.
Also, don’t expect the money to simply roll in. That’s a fact some retail media networks have learned the hard way. Non-retailers might understand this point better, since they don’t have that pre-existing ad base that retailers do. You will need to build the business by marketing yourself to the advertising community.
The best way to do that well is by hitting the market with a network that has fully addressed all the needs outlined above, so that you’re ready to deliver what advertisers need before you start talking to them.
About the Author
As EVP at Mars United Commerce, Michele Roney leads the Retailer CX business, which helps retailers drive growth through marketing, customer experience design, and the creation, operationalization, and monetization of retail media networks. A 32-year company veteran with experience across retail marketing, media and promotion, she has led the ground-up development, management and support of leading networks both in the U.S. and Canada.
