As EVP of Media and Ecommerce at The Mars Agency, Ethan Goodman has conducted groundbreaking work in the areas of digital shopper marketing, ecommerce, retail media and voice-enabled engagement. An industry leader in ecommerce and media practices, he delineates opportunities to gain a deeper understanding of shopper behavior and influences through retail media growth.
In your opinion, what has been the catalyst for this explosive growth of retail media?
We look at four key factors that combined over the last few years to create a perfect storm of sorts:
1. The rapid rise in ecommerce sparked by the pandemic, which brought millions more consumers to retailer websites almost overnight.
2. The growing demand for first-party data that lets marketers better target their audiences and measure their results. Retail media networks maintain a wealth of shopper data that is completely unique to any consumer data available elsewhere, as well as a menu of owned assets online, on mobile devices and in physical stores that can be tapped to reach shoppers in relevant moments.
3. The expected demise of third-party cookies, which is placing an even greater premium on first-party data.
4. The increasing need for retailers to improve their already slim profits as more of the business shifts to ecommerce, where operating margins are even thinner. Selling retail media is a great way to do that — as Amazon has already proved to the industry.
Retailers are becoming media owners. How will this impact brand strategy and media planning?
We’ve hopefully moved past that initial stage where retailers were solely acting like media owners — just trying to sell ad space — and instead are now viewing their advertiser relationships as holistic opportunities to drive ongoing, mutually beneficial business growth for themselves and their advertising partners.
That said, the potential for retail media to deliver full-funnel marketing opportunities has brands thinking less about “national vs. shopper” media planning and instead adopting an omnichannel mindset. They’re integrating vertically across internal functions to build plans that take shoppers all the way through the purchase funnel, using retail media to drive brand awareness and consideration among shoppers who can then be guided directly to purchase. They’re also aligning horizontally across their retailer activity, making sure that sales, shopper, trade and ecommerce planning are connected.
The ultimate benefit is better, more seamlessly integrated, personalized experiences that do a better job of driving conversion by taking shoppers all the way through the funnel.
What opportunities do AI and CX data offer brands in the customer journey?
From a media perspective, we’re excited about the sheer computational power that gen AI can provide in three key areas:
Predictive planning: Gen AI ultimately can develop about 80% of an effective media plan by mining historical performance and data and numerous other factors. That will free up our “human” planners to apply their irreplaceable expertise to making each plan perfect.
Creative: We’re already doing a mind-blowing amount of creative versioning to deliver ad personalization. Some of this work is already automated using dynamic creative optimization tools.
Optimization: Automating more of the work done by our hands-to-keyboard search and DSP media buyers will accelerate the process, while likewise freeing them up for more strategic activities.
Elsewhere, the new search tools recently introduced by Amazon and Walmart should provide a wealth of insights into consumer needs and preferences. And the influx of retail media into the physical store should similarly drive a deeper understanding of shopper behavior and influences.
What kind of retail experiences do GenZ and GenA value?
Our youngest generations want convenience, speed, efficiency, fun, and unlimited options — which is why, even though they’re digital natives who are leading the trend toward social commerce and livestream shopping, nearly all of them still frequent physical stores to buy products immediately and/or have a tactile experience. They also demand authenticity and purpose and want retailers and brands to support the same causes they do: mental health, the environment, racial/gender equality and LGBTQ+ rights, to name a few.
How can brick and mortar locations evolve so that they remain relevant in a digital world?
It’s hard to speculate about the lost relevance of brick and mortar when the vast majority of purchases still take place there. Retail media is moving into the store not to save it, but to better align the full shopper journey and, as importantly, to better align the brand advertiser’s complete commercial investment with the retailer and full scope of engagement with the shopper.
The obvious way to make this happen is to connect the store to the digital world either by upgrading traditional marketing tactics (like product displays and sampling) or adding new interactive elements such as digital signage or even just QR codes and in-app messaging. In terms of a relevant experience, the real potential is using these new tools to deliver personalized, localized and real-time communications that will truly resonate with shoppers and make them want to come back.