‘Fragmentation is not our friend, unification is’ – what’s next for retail media?

But the massive growth of the next big advertising channel has brought about a fragmented marketplace, one that, through the eyes of the advertisers and agencies looking to buy retail media inventory, could be seen as cluttered and, perhaps even a little chaotic.

Media buyers have been here before. Traditional media, search and social too are fragmented in their own way, but they have stood the test of time. And what unites them is a uniform, consistent approach to systems, processes, language and measurement, and how they show up in front of agencies and advertisers.

Retail media is now the third-largest digital advertising channel behind paid search and social, growing twice as fast as social and three times as fast as search. Two years from now, it will be bigger than TV. At such a pivotal point for retail media, the need for uniformity and consistency is key.

In the words of Criteo’s chief exec Megan Clarken, “fragmentation is not our friend moving forward, it’s all about unification”. She believes that now is the time for a unifying moment for retail media to stay on course, a time to “unify behind common currencies, ways of doing business, language and models – to show up alongside others in a unified way to get in front of advertisers and agencies.”

Less complexity, more flexibility

The challenge is that different retail media networks operate differently; each set up in their own way, with their own infrastructure, making the job of buying ad inventory more complex and complicated than it should be to reach its full potential.

Retail media isn’t new – but it has evolved in terms of the opportunities. In the past, retail media was confined to trade and shopper teams with a one-to-one relationship with the retailer. Now, it extends across the digital realm to multiple channels and multiple retail networks. This changes the dynamics between buyer and seller, which means that the ecosystem must transform and adapt.

The solution on the buy-side isn’t to simply add more people to be able to buy from multiple platforms. The average number of platforms people can handle is six, explains Criteo’s global chief revenue officer Brian Gleason, adding that “we’re seeing more and more retailers come in every day. But despite the opportunity, the challenge is common: how do I buy across so many and get the data to be able to match, optimize in real-time, and open up the interstate of demand?”

A streamlined process means that advertisers and agencies need standardization and unification in the way retail media inventory is bought. To move forward, a united front and approach requires collaboration between all parties in the ecosystem – from retailers to brands, agencies and adtech – to avoid friction in the process and solve for fragmentation.

“The opportunity is for all commerce-driven companies to buy and sell audiences engaged in shopping to be able to cut through and connect in a more unified retail media ecosystem that ultimately creates more unity across the broader advertising marketplace,” says Clarken.

A single point of entry

This will require a single point of entry for advertisers and agencies to find, buy and run campaigns across the whole retail media footprint, from platforms in-store to onsite and across premium publishers offsite.

The launch of Commerce Max – deemed ‘the world’s first full funnel multi-retailer commerce’ demand side platform (DSP) – comes at a pivotal point in retail media’s journey. Criteo has partnerships with 210 retailers, 1,500 agencies and 1,200 publishers – and is also seeing 2,400 brands coming to the table to get better results from their advertising dollars.

Early tests with Best Buy, Macy’s and Shipt saw conversion rates, on average, more than double when running both onsite and offsite advertising through the platform. It’s driving greater return on ad spend for advertisers too; a successful test with GroupM and Unilever, for example, saw the brand’s conversion rate rise by over 400%.

Commenting on the launch of Commerce Max, Billy Dyer, club team shopper marketing lead at Unilever, says: “We now have one point of entry to a pivotal retail media network, all within a single platform, that applies the same KPIs to retail media as those we use for our programmatic buys. Combining onsite and offsite targeting enables us to focus media spend across a broader part of the shopper funnel while finding the most suitable audiences wherever they are.”

New measurement standards

Retail media provides performance that doesn’t exist anywhere else in the market, underpinned by closed-loop measurement that enables advertisers to determine the effectiveness of campaigns and optimize accordingly, in a quick and efficient way.

“Brands can fundamentally change the way they plan media and get real-time results, which is a gamechanger,” says Gleason. “Closed loop is a tool, but what you get from that reporting is really the holy grail. This opportunity is transforming brands into performance advertisers.”

But there are growing pains that come with measurement too, calling for greater consistency. “It’s the same as a scoreboard – one person can’t score one way versus somebody scoring another way,” adds Gleason. “We need standardization to optimize across all media – that’s where the growth is and will continue to come from.”

As the industry ushers in the era of retail media 2.0, it’s clear that retail media will fundamentally change the way media is bought and sold moving forward. With a goal to make sure that every dollar spent on retail media will drive a commerce outcome, bridging the gap between multiple channels and retailers will not only deliver more holistic performance results, but drive towards unified industry standards for retail data in a long-term, sustainable way.

To explore how Commerce Max is helping to address fragmentation and drive commerce outcomes across the advertising ecosystem, visit here.