The Premium Inventory Opportunity Amid the Retail Media Surge

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Retail media is one of the fastest growing media segments. Expenditure is expected to increase by 26.3 percent to $ 30.2 billion in 2022. The industry is moving from third-party models to premium models. As you experience this change, your own media markets will be important to drive revenue growth while protecting the integrity and privacy of customer data. This evolution is not without its challenges.

What are retail media?

Retail media occurs when companies market their products or services to customers at or near their point of purchase. Or, their point of choice where they compare different brands and products. Retail media is usually done through online advertising, in-store advertising, sampling, coupons or vouchers, and loyalty cards. Retail marketing is an important component of buyer marketing campaigns.

The means of retail sale cannot be left out of the promotion of goods and services, at points of sale and consumption, neither near nor beyond.

A retailer’s ecosystem can have many retail media channels. But that doesn’t mean these channels are owned or even operated by these retailers. In fact, many channels are operated independently by specialized media companies that own other media properties outside the retail environment.

What privacy concerns do customers have?

As Ben Thompson has argued, the inherent nature of the Internet is that data is propagated and collected. This, he says, is at odds with how things work in the physical world, where data collection is an explicit act and anonymity is the default state.

In this world, data has often been sold to third-party vendors or analyzed using third-party models. For example, when you go to Facebook. Facebook will not only track your activity when you leave the Facebook ecosystem, but will also sell this information to third parties. These third parties will use this data to create models and target their ads more accurately.

The implication is that people are part of agreements they don’t know. In other words, by being on a website, you agree that you don’t want to be tracked and your data sold. And, for this third party to target ads to you through their models.

Apple’s decision to operate the digital advertising business by changing its default settings to prevent third-party data from being tracked and collected is the most important step in protecting consumer data.

Retail media publishers face the same difficult decisions that other publishers have faced: how to protect customer data in an environment whose default state is the dissemination and collection of data. This is especially difficult. Because, going against the inherent nature of the Internet, publishers have to bear costs that they would never have assumed before. Standards and infrastructure are still being developed to achieve this while maintaining profitability.

Retailers have privileges because they have access to data that other publishers do not usually have: data from their own buyers. This data is higher than that of publishers: publishers only know the range of options that customers are willing to consider, while retailers know what customers usually buy. With a superior data set, retailers are in a better position when it comes to finding information. However, they still need to ensure that the privacy of customer data is maintained without losing profitability.

Why are retail media growing?

The pandemic forced physical stores to permanently change at least part of their online business. Even in a post-pandemic world, it’s hard to imagine stores that don’t have an online business. What was first motivated by health issues will remain because customers have seen the convenience of online shopping.

In addition, the digital transformation makes retailers more robust by diversifying their sources of revenue. The digital transformation is taking place at a time when privacy concerns are at their peak. The European Union’s General Data Protection Regulation (GDPR) has forced many technology companies to adopt more privacy-conscious policies. In addition, the lobby of consumer groups and the general public has raised the stakes.

Retail media is important because it does not rely on third-party data. First-party buyer data guarantees consumers’ privacy interests while providing a more detailed set of data than other publishers are accustomed to.

Retail stores such as Walmart, Amazon, Instacart, Kroger and Lowe’s have scaled up with first-party buyer data. Spending on retail advertising included increasing the percentage of spending on digital advertising. Its increase is due to its ability to leverage the data of its own buyers to discover unique knowledge and offer more targeted ads.

As regulators work to protect the privacy of customer data and companies move toward greater protection of privacy, retail media will grow.

Related: 3 reasons why privacy is important to your business, your brand, and your future

Making the most of premium inventory

It is essential to reduce costs while increasing revenue, in order to increase profitability. According to Adsense Media Group, an Amazon marketer must reduce the cost of selling Amazon advertising while increasing revenue. Typically, retail media should optimize cost per thousand impressions (CPM). This is usually done by monetizing ad inventories through open markets. However, open markets are not very good at monetizing ad inventories.

In addition, open markets are in jeopardy, given concerns about data privacy and restrictions on data sharing, whether through regulations or business actions such as those of Apple. Consequently, open markets are not a sustainable basis for a business model.

Sustainable, high-income business models with better transaction capabilities for programmatic agreements will need to be built. The world has gone from human-driven manual offerings. Programmatic agreements will drive revenue generation in the future. This means assigning bids to algorithms that will run all of your favorite private auctions and programmatic bids. This will add value to your business and ensure that your business model is more controlled and well managed.

The costs in this new regime will be much lower than the old models. Programmatic offerings and the use of automated processes will reduce the cost of direct sales while improving efficiency. Cost reductions are not just about automation and the abandonment of human-driven processes. But also for the ease of use and deployment that this technology entails. The result will be smaller, lighter computers and faster execution times. Profitability will be higher because the lower cost of sales means more revenue is left as a profit.

Related: 6 Tips To Turn Buyers Into Buyers


The retail media has a lot to offer. At a time when privacy concerns are high, retail media offers a way to take advantage of the good of the Internet, spreading and collecting data, leaving negatives aside. These include the use of data by third parties and subsequent damage to the privacy of the data. Traditional advertising is disrupted. It is essential to diversify revenue streams and make the business stronger by adopting retail media. The beauty of retail media is that companies start with a piece of real estate data that is more valuable than other publishers had: first-party buyer data. These data are much clearer. Because, instead of just saying what options buyers are willing to take, they show what they are willing to buy.

The goal of a business, as Peter Drucker once told us, is to create and retain a customer. Retail media brings us closer to this because it shows the creation and maintenance of a customer. This new approach will improve profitability by reducing costs and making teams smaller. Also, making processes faster and more efficient. Retail media is the future.

Related: Retail sales will never return to normal. That’s a good thing.

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