THE RETAIL MEDIA NETWORK frenzy may be approaching the end of the beginning, as Shopper Media bring more In-store retail media options to CPG Brands. Now, the hard work starts.
For CPG brands, the story-within-the-story revolves around a growing number of in-store networks designed to reach shoppers where the vast majority of final purchase decisions are still being made. Call it “shopper media.”
In the food-drug-mass channels, 84% of transactions are still taking place in physical stores, while FMI The Food Industry Association estimates that just 6% of grocery items were sold online in the full year 2023.
This is the fourth part in a series. Republished here by permission from CPGmatters.
As we have been reporting here in recent months, that reality compels brands to consider where their newly-repurposed retail media budgets will best be spent. So far, a handful of very large, primarily digital networks have soaked up the lion’s share of the ad investment.
CPGs have a long history of providing marketing support for their brands across the broad physical retail landscape, not only at the largest chain accounts. Distribution power is brand power.
For this reason, although the big numbers and hype have surrounded digital retail media sales, shopper media retain a significant value-creation opportunity for brands that has barely been tapped:
- Frequency of visits. Four out of five shopping trips are still in-person. Even for regional retailers, this can add up to millions of monthly opportunities to present messaging from brands, on screens, via audio and on personal digital devices.
- Loyalty penetration. Retail media works best when messages and offers are finely personalized. As frequent shopper participation approaches the saturation point, they present a superb mechanism for brands. With appropriate access, they can leverage first-party and zero-party data to efficiently present offers that motivate repeat consumers and influence potential ones.
- Aligned with product distribution. Half or more of all CPG product is distributed across numerous regional and independent retailers. Brands intuitively recognize that physical distribution power is the foundation of lasting success. So far, their retail media messaging has not matched that level of coverage.
Not surprisingly, retail media networks remained top-of-mind at last month’s Shoptalk conference in Las Vegas, both on the presentation stages and in the aisles of the exhibit floor. CPG and grocery attendance was light, and the presentation topics focused on the large retail media and commerce media networks, with little to no mention of the fast-moving consumer goods sector.
“Every CMO is looking for ROAS, incrementality, attribution,” said Lisa Valentine, President, Ads at Best Buy during her on-stage interview, in what was labeled the “Innovation Zone” of the conference.
Dominant retailer networks, including Best Buy Ads, Walmart Connect, Albertsons Media Collective, Amazon Ads and a few others, are sometimes described as “publishers” by advertisers and other insiders. Each commands significant geographies and audience scale, demanding attention from advertisers, but their shopper coverage cannot encompass all the consumers a brand needs to reach. Mechanisms are needed to assemble those audiences by combining publishers, large and small.
Who puts it together: networks, platforms, exchanges, agencies
It useful for CPGs to distinguish between classes of publishers: in-store networks, media buying platforms and the programmatic exchanges and advertising agencies who are stepping in as retail media consultants to the brands:
- In-store networks promise to help advertisers reach a certain number of desired locations, screens or devices. The most advanced can link those touchpoints to provable shopper behavior using in-store sensing, shopper loyalty apps, POS data, geofencing or a combination.
- Demand-side platforms, or DSPs, are a type of platform used by advertisers and agencies to find manage and execute programmatic ad campaigns.
- Programmatic exchanges are ad-buying intermediaries that promise to help an advertiser reach a certain desired audience, usually via a collection of digital and in-store channels.
- Ad agencies traditionally have provided media planning and buying services for CPGs. Many are working to expand these services to follow the money as it shifts from linear TV advertising into digital and retail media.
Shopper media networks: Keys to critical mass?
Brands require a degree of “critical mass” to reasonably devote their analytic attention and media investment to any in-store network. To reach consumers where they shop, that requires a plethora of deployed devices, along with mechanisms to access them and measure results.
Some notable in-store (shopper media) network operators include:
- Vibenomics – In-store audio heritage expanding its presence with video screens. Claims 1.2 billion monthly shopper visits; 170 million monthly unique visitors, through 25,000 retail locations.
- Ideal by Design House – Dynamic digital store circulars displayed on shopper digital devices. Its network presently covers 18,000 locations; in 5,000 retail banners.
- GroceryTV – Digital in-store ad network. Claims 234 million monthly shopper visits; 4.9 billion monthly impressions; 84 million unique customers; via 32,434 displays in 5,859 retail locations in all 50 states.
- Instacart Ads – Caper Carts smart shopping carts, Carrot Tags ESLs, AI-Powered landing pages for retail delivery partners. Delivers groceries from 85,000 stores; 1,500 retail banners across 14,000 cities and towns in North America. The company claimed 25 million active users as of Q2 2024.
- Shop2Cook/Adsta – Shop2Cook is a kiosks network designed for independent grocers, featuring recipe content and offers. Installed in 1,200 retail locations. Its Adsta platform is billed as “Retail Media For CPG’s” that combines online, pop-ups, e-newsletters and in-store digital displays.
- Freeosk – A network of kiosks that dispense free product samples to shoppers who use their loyalty cards or apps. They also display advertising on digital screens in 1,300 retail locations in the U.S.
- Stratacache/PRN – Digital signage company that expanded into shopper media with the acquisition of PRN Networks in 2015. Its Retail Digital Media division offers shelf-edge displays, window-facing displays, cooler door signage, claiming 350 million monthly viewer impressions in 15,000 locations.
- In-Store Connect by Quad– Launched in 2024 by Quad/Graphics, Inc., this network features digital endcaps, in-aisle screens and kiosks, with installations in about three dozen retail locations so far. It seeks to connect in-store audiences for regional grocer grocers at scale. The company states that it will soon implement a link to retail loyalty apps.
- QSIC – In-store audio network, Australia-based, deployed at 7-Eleven, Coles Express, and McDonald’s reaching over 100 million shoppers monthly at the point of purchase. Announced plans call for more than 70,000 speakers to be deployed in North American retailers within 2025.
- Independent Grocers Alliance – The IGA acquired Inmar’s Scanner Applications business unit in December 2024 with the intent of making it easier for its 6,300 member retailers (2,100 in the U.S.) to provide CPGs with shopper media solutions.
- VusionGroup – In addition to its massive ESL deal with Walmart announced in late 2024, Vusion Group’s Engage marketing platform delivers digital campaigns to shelf-edge displays and captures engagement data with sensor rails.
- CoolerX – Began with smart screens on cooler doors (Cooler Screens) in grocery, drug and convenience stores, then pivoted to launch a self-service in-store retail media platform in mid-2024 after a contract dispute with Walgreens resulted in the removal of more than 10,000 smart doors.
The year of the digital endcap?
When Hy-Vee announced it had added 10,000 digital screens within its 400 stores last December, it signaled a new level of “screen density”. Its RedMedia shopper media network is powered by GroceryTV. Industry sources say Hy-Vee purchased the hardware from Samsung, a significant capital commitment. Red Media also communicates with shoppers via their personal digital devices, by integrating with the loyalty app.
In-Store Connect by Quad screen network launched one year ago. Said Julie Currie, EVP & Chief Revenue Officer in an interview at Shoptalk, “Our mission is to put together a national network of regional retailers who reach the majority of consumer shopping trips nationally. We are creating an elevated shopper experience leveraging in-store screens.”
The first 15 In-Store Connect installations, announced one year ago, were in 15 Save Mart Companies stores in California, under the retailer’s Lucky Stores, Food Maxx and Save Mart banners. It followed last July with 15 Homeland stores in Oklahoma, with eyes on building out a national network. Many more are anticipated.
“This will enable CPG brands to capture intention, inspiration and create powerful brand moments that drive conversion at scale,” Currie said.
This is the fourth part in a series. Republished here by permission from CPGmatters.