by Mark Baum, chief collaboration officer, SVP, industry affairs, FMI – The Food Industry Association
Independent retailers have long enjoyed the loyalty of their customers, offering personalized service and a unique shopping experience. This deep-rooted consumer trust is their greatest asset – and now, retail media networks present an opportunity to transform that loyalty into a powerful revenue driver.
By leveraging RMNs, independent retailers can unlock targeted advertising opportunities that not only drive sales but also strengthen their relationships with brands and shoppers alike.
While large retailers have already embraced RMNs to monetize their first-party data and enhance their digital advertising capabilities, independent retailers risk missing this critical shift.
The ability to harness consumer insights and deliver highly relevant advertising to engaged shoppers is a game-changing opportunity, and those who act quickly and proficiently can secure a competitive advantage.
RMNs allow retailers to sell advertising across their assets, including their offsite and onsite media, using their own shopper data to target ads more effectively.
Unlike traditional digital ads that rely on third-party cookies and broad demographic assumptions, RMNs leverage real-time purchasing behavior to deliver precision-targeted campaigns. This ensures that advertising efforts are more efficient, driving higher conversion rates and enhancing the consumer shopping experience.
Retail media spending is surging, with our organization (FMI) and NielsenIQ projecting in “The Evolution of Retail Media: Decoding What Works – And What Doesn’t” that consumer packaged goods media investment will reach $27 billion by 2026.
In this same analysis, we found that the grocery sector alone is expected to generate $6.6 billion in RMN-related spending. Independent retailers, with their trusted relationships and local consumer insights, are well-positioned to capture a share of this growing market if they act strategically.
Consumers today interact with brands across multiple touchpoints, from in-store visits to online shopping and social media engagement.
With one in five CPG ad buyers using 11 or more platforms, brands are seeking omnichannel advertising opportunities that blend digital and physical shopping experiences. Independent retailers that tap into RMNs can provide a seamless advertising ecosystem that meets these evolving consumer behaviors.
Additionally, consumer loyalty to independent retailers is a key advantage. In 2023, the top 10 most-visited grocery chains accounted for only 42.6 percent of total grocery visits, meaning that smaller retailers still command a sizable portion of market share.
Brands simply cannot and should not ignore a third of their customers, especially consumers as brand loyal as those who shop almost exclusively at their independent stores. This level of trust offers independent retailers a unique selling point – namely, the ability to deliver high-quality, high-impact advertising to an engaged audience.
The retail media landscape is rapidly shifting and evolving, and independent retailers must move quickly to take advantage of these digital advertising innovations. By leveraging strong customer relationships and first-party data, they can compete in a meaningful way while opening new revenue streams.
Independent retailers should begin by utilizing their first-party data – capturing insights from in-store transactions, loyalty programs and online sales – to develop targeted advertising strategies. Optimizing digital real estate, including store websites, mobile apps and in-store digital displays, will ensure that advertising placements reach the right audience at the right moment.
Retailers should also establish an ad inventory that caters to CPG brands looking for effective omnichannel advertising solutions. Whether managing this inventory independently or partnering with a retail media platform, independent retailers can offer brands, high-value placements that integrate seamlessly into the shopping experience.
Investment in RMN-specific technology and talent will further enhance success. Whether by hiring internal specialists or collaborating with external ad tech partners, independent retailers can build an RMN strategy that maximizes advertising potential while maintaining an elevated overall consumer experience.
Demonstrating return on investment through closed-loop attribution will also be critical, as brands seek measurable insights regarding the impact of their advertising spending.
The future of retail marketing is omnichannel, data-driven and customer-centric. Independent retailers that integrate RMNs into their business models today will not only strengthen their competitive position but also build lasting partnerships with advertisers eager to connect with engaged and loyal shoppers.
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