Renee Miller, Founder and ECD of purpose driven digital agency focused on sustainability, The Miller Group, sheds light on the expansion of retail media and the opportunities this creates for brands.
In your opinion, what has been the catalyst for this explosive growth of retail media?
The increased use of digital channels by consumers during the pandemic has made retail media more attractive to brands. Analysts estimate that global digital retail media ad spending is on the rise, set to reach a staggering $133 billion by the end of FY 2024 and $160 billion in the U.S. alone by 2027. Retail media isn't just about advertising revenue; it's a game-changer for retailers' profits, too. Major players in the retail world are strategically reinvesting the profits they make from retail media advertising to fuel expansion. For example, Walmart's significant growth in ad revenue holds great importance as it serves to offset the expenses associated with new fulfillment and distribution centers, as well as its expansion in the grocery category.
Retailers are becoming media owners. How will this impact brand strategy and media planning?
Retail media is now the third-largest digital channel in the world—and to put that number into context—it will likely overtake social advertising in the next five years to become the second-largest digital channel behind paid search. It is imperative that brands be prepared to test and learn and have systems and technologies in place to ensure they don’t lose market share to the competition.
Retailers with logged-in user bases offer valuable customer data and audience targeting. For example, most Americans have an Amazon Prime account, providing a large pool of targetable shoppers for brands to reach through retail media.
What opportunities do AI and CX data offer brands in the customer journey?
AI offers ample opportunity to tailor CX to each individual consumer. For instance, recommendation engines use machine learning algorithms to analyze data and provide personalized product recommendations at various touchpoints in the customer journey.
How can brick and mortar locations evolve so that they remain relevant in a digital world?
The future of brick-and-mortar stores lies in the seamless integration of digital and physical elements. Technologies like guest Wi-Fi are at the forefront, crafting personalized, tech-enhanced experiences that ensure these stores remain relevant in the retail landscape.