Retail Media a $8.5 billion opportunity for U.S. grocery retailers, says research

By Retail4Growth Team | October 25, 2024

A new study Grocery Doppio, an independent source of grocery insights and data called ‘The State of Digital Grocery: In-Store Media Monetization' conducted in collaboration with RRD, developer of nCountR®, surveyed over 100 grocery executives with digital media decision-making authority, unveils insights from the current state of retail media networks, with a particular emphasis on in-store integration.

Retail Media, which refers to both digital and in-store advertising networks, is increasingly being projected as the next big opportunity for advertisers and retailers alike. While it’s a potential revenue opportunity for retailers, for marketers it’s another channel to capture their audience in the out-of-home advertising space.

In markets like UK and US, in-store media networks are increasingly being leveraged in the grocery segment.

A new study Grocery Doppio, an independent source of grocery insights and data called ‘The State of Digital Grocery: In-Store Media Monetization' conducted in collaboration with RRD, developer of nCountR®, has revealed that retail media is an $8.5 billion opportunity for U.S. grocery retailers to boost growth and margins.

The company informs that the survey of over 100 grocery executives with digital media decision-making authority unveils insights from the current state of retail media networks, with a particular emphasis on in-store integration.

Recognizing the potential of leveraging both digital and in-store real estate for targeted advertising, grocers are looking to strategically integrate digital channels with the physical store experience. Nearly 70% of respondents believe in-store media capabilities provide a competitive edge over third-party platforms (like social media or search engines). “Physical stores not only attract more foot traffic, but also enhance engagement by incorporating digital elements into the shopping environment and customer interactions,” says the research report.

“The potential for in-store retail media networks to drive revenue growth across the grocery sector is limitless,” said Hans Fischmann, Vice President and General Manager, nCountR by RRD. “Grocers are uniquely positioned to personalize the shopper experience, enabling them to accurately measure return on ad spend and strengthen their bottom line—especially during a time of prolonged inflation and increased competition for share of wallet.”

Additional findings supporting growth opportunities for grocers include:

Retail media networks represent a universe that includes both online and offline elements- 87% of respondents say it's important to tie in digital channels and the physical store for media monetization. Almost all (93%) CPG brands surveyed by Grocery Doppio in Q2 want the ability to tie in digital and store engagement for a complete view of the shopper journey to inform their decisions on ad spend.

The number of retail media networks will double in the next 18 months- 68% of grocers say investment in a media network is a high priority. For speed to market, 97% of grocers will deploy a white-label or third-party solution.

Holistic omnichannel integration, network scale, and talent are needed for retail media integration success - Retail media monetization has emerged as a C-level priority for 73% of grocers and 88% say media monetization is a top growth priority. However, the study warns grocers face a short window of execution and that a meticulous strategy and execution is needed toachieve seamless digital-storeintegration, compelling content, and measurable ROI.

Media networks have been positively received across all shopper demographics -Most shoppers (61%) surveyed in a Q2 Grocery Doppio study said they found the in-store media content useful, with 73% of millennial respondents saying it had a positive impact on their overall experience. There’s also been a 38% increase in shopper engagement with in-store media.

“To align with consumers’ omnichannel habits, grocers are making their in-store retail media visible and measurable. Gaining a holistic view of the shopping journey benefits retailers, brands, and consumers alike,” said Gaurav Pant, Chief Insights Officer at Incisiv.