Retail Media Solutions Build A New, Profitable Revenue Stream For Retailers
We have written and talked a lot about the boom that retail media is going through. And it makes sense why: Amazon is the third leg of the media triopoly with its $20 billion-plus ads business; other retailers such as Kroger, Target, and Walmart are making big strides to take their own share of ad dollars; and consumer packaged goods firms are thrilled about being able to do real performance marketing.
Today, I am very excited to announce the first Forrester Wave™ evaluation of sell-side retail media solutions! This report is a deep analysis into the market of providers that help retailers build and stand up their own media network. Our findings will help retailers at all stages of building their media business select partners to assemble a monetization stack.
In our research, we found that retailers rely on providers for several key pillars of their media business:
- Build an omnichannel media offering. Retail media is most often thought of as monetizing the e-commerce website with search and display ads. But savvy retailers are thinking much bigger than website monetization: They want to offer media options to brands that influence consumers at every touchpoint. Retailers like Walgreens are coming up with innovative ways to digitize their stores with ads. Other retailers offer brands access to their first-party data for campaigns on major publisher sites. And many grocers that we spoke to are trying to automate and improve shopper marketing programs through retail media technologies and services.
- Fuel advertiser demand. Over 58% of client references from our Forrester Wave evaluation use retail media solutions to help sell their media offering. Retailers need this sales support to bring their media business to market, build relationships with advertisers at brands, and tap into ad dollars from non-endemic brands.
- Make their first-party data monetizable. One retailer told us, “The goal of retail media is to give brands better access to our first-party data.” And that makes sense given the treasure trove of data retailers have, the little data that most consumer goods brands have, and the third-party cookie going away. Retailers have a huge opportunity to grow their media businesses substantially in the future by allowing brands to build campaigns across digital channels using their first-party data. Almost all the providers in our evaluation cited first-party data monetization as a major focus area in their roadmaps going forward.
- Provide brands with flexible service options. All retailers — from Amazon to Target to Walmart — started their media businesses as managed service only. And then Amazon bucked the trend and offered advertisers self-serve tools for media planning and buying. Today, most large brands want flexible options, and retailers need partners to help accommodate. One retailer told us, “We know the Nestlés and P&Gs of the world have the resources that incline them to use self-service, but we also work with smaller brands that need hands-on support. Our stack of providers helps us flex to any situation.”
We encourage retailers to read our report on sell-side retail media solutions here for more insights and detail. And look out for our report on the state of retail media later this fall.
If you have questions or want to talk more about our Wave evaluation, feel free to request an inquiry with me.