The grocery industry is undergoing a digital transformation. Retail media networks are emerging as a powerful force for marketing in the industry, offering new revenue streams for grocers and valuable advertising opportunities for brands.
Retailers can manage their RMNs in multiple ways. They may operate them in-house, as seen with grocers such as Albertsons, Meijer and Amazon, which launched the first RMN in 2012. Alternatively, these networks might be managed by independent media agencies such as Instacart and Swiftly.
The scope of these networks also can vary as some focus solely on online channels, while others are more comprehensive.
RMNs use first-party data, such as customer purchase history, loyalty program information and online browsing behavior, to deliver highly targeted ads to shoppers across various channels.
These platforms can use data from online and offline sources. This includes information gathered from retail apps, loyalty programs, coupon redemptions and in-store purchases, creating a complete view of customer behavior.
Grocers embracing RMNs
Many grocers have been introducing RMNs to gain deeper insights into customer preferences and behaviors, enabling them to personalize the shopping experience.
In an increasingly competitive landscape, RMNs also allow grocers to differentiate themselves and attract new customers.
UNFI created the UNFI Media Network to help the retailer compete in a digital-first world. It partnered with Swiftly to connect more meaningfully and personally with consumers while providing opportunities for its suppliers to showcase their brands.
“UMN enables UNFI’s retail customers and suppliers to better compete in today’s retail marketplace, with an increasingly digital focus,” said UNFI CEO Sandy Douglas. “We believe UMN, powered by Swiftly, will help us create compelling and sustainable value for our customers, suppliers and shareholders.”
By offering valuable advertising space, grocers can foster stronger relationships with brands, potentially leading to exclusive deals and improved product placement.
Arkansas-based Harps Food Stores is an independent grocer that has also added its own RMN across stores. Using Grocery TV’s content management system, the retailer launched in-store digital campaigns to increase visibility of its marketing initiatives.
UNFI and Harps Food Stores are among several food retailers that have created space for RMNs in their marketing departments over the past two years. Hy-Vee, Associated Grocers of New England, Northeast Grocery Inc., Wakefern Food Stores, Redner’s Markets and the Independent Grocers Alliance are among several others that are adding these technology services to their stores.
[RELATED: UNFI Introduces Retail Media Network Powered By Swiftly]
Retailer Owned Food Distributors and Associates (ROFDA) has teamed up with multiple third-party providers to provide a comprehensive suite of retail media network solutions tailored to members’ needs.
“When independent grocers band together to leverage their omni-channel media assets and the resulting data, they transform into a formidable advertising powerhouse with a collective voice that can’t be ignored,” said Sarah Rivers, director of digital and e-commerce programs for IGA.
“Together, they hold the kind of influence that can reshape how CPGs and non-endemic brands connect with shoppers of independent grocers, allowing us to deliver the same level of personalization, convenience and value shoppers see from the biggest national chains.
Benefits for brands
RMNs use precise targeting for brands to reach their ideal customers with precision, maximizing the return on advertising spend. They also provide a direct channel to engage with shoppers at the point of purchase, influencing their buying decisions.
For example, brands Califia Farms, General Mills, Primal Kitchen and Siete Family Foods have been using Instacart’s Carrot Ads since 2023 in a variety of ways with Sprouts Farmers Markets’ e-commerce experience.
The brands can add promotional campaigns across a grocer’s offerings, collecting detailed campaign performance data to track the effectiveness of their campaigns and make data-driven adjustments.
Retail media networks are revolutionizing the grocery industry, offering new opportunities for grocers and brands. By embracing this emerging technology, grocers can enhance their profitability, improve customer experiences and gain a competitive edge. Brands, in turn, can leverage RMNs to reach their target audience with unprecedented precision and drive sales growth.
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