Retail media has emerged as a powerful channel for brands and retailers, thanks to its rich data sources and direct consumer connections. However, as this sector grows rapidly, it faces the risk of repeating the challenges that hampered programmatic advertising. Programmatic’s complexity, lack of transparency, and fragmented ecosystem offer important cautionary signals for the retail media industry.
The Power of First-Party Data and Identity
Retailers hold valuable first-party data that provides detailed insights into shopper behavior and preferences. This advantage positions retail media networks (RMNs) to deliver highly relevant and personalized advertising. Nevertheless, extending reach beyond retailer sites requires identity solutions that accurately match ads to real consumers while respecting data privacy. Without these systems, targeting becomes less precise, limiting campaign effectiveness and consumer trust.
Establishing Clear Standards and Measurement
The lack of unified industry standards contributed to programmatic’s inefficiencies and confusion. Retail media faces similar risks with numerous RMNs and varying measurement approaches. Creating clear, commonly accepted standards would help combat fragmentation, improve interoperability, and provide advertisers with consistent, comparable metrics. Beyond basic clicks and impressions, measuring incrementality and offline impact remains vital to assess effectiveness fully.
Asking the Right Questions
Advertisers engaging with retail media should conduct rigorous due diligence. Important questions include how RMNs utilize first-party data, processes for attribution, transparency of fees and placements, and measures to prevent fraud. Such scrutiny encourages higher accountability and helps marketers select partners that align with their objectives and ethical standards.
Learning Lessons for Future Success
By addressing the challenges known from programmatic advertising early, retail media can foster trust, drive efficiency, and accelerate growth. Strong identity solutions, unified standards, robust measurement, and informed advertiser decisions will position retail media networks as a sustainable, impactful channel in the evolving marketing ecosystem.
