Retail media: the underlying trend in e-commerce

Simultaneously a profitable channel for retailers and an opportunity for brands to gain visibility in the purchasing journey... In 2024, retail media is asserting itself as a foundational digital advertising trend, experiencing significant growth. Indeed, the monetization offerings for advertising spaces from retailers are multiplying, and investments in retail media platforms are exploding.

In Europe, the retail media market is expected to grow significantly, more than tripling in value from €9 billion in 2021 to €29 billion in 2026 - according to IAB Europe, an organization representing online advertising players. And within five years, this market will be worth more than $175 billion worldwide - according to GroupM, a global leader in advertising consulting and investment.

Retail media is not a new concept. For a long time, large retail chains have embraced Trade Marketing, offering their suppliers various advertising opportunities in their physical stores, such as endcap displays or shelf advertising. Retail media can be seen as a digital evolution of these practices, allowing brands to expand their visibility in the 'digital aisles' and showcase their flagship products, ranges, or new releases.

But if retail media has gained power, it's thanks to the collection and use of data. Visitors who have consented or participate in a loyalty program give retailers access to a valuable source of data, allowing them to gain invaluable insights into the preferences and consumption habits of these individuals. It is also possible to collect and leverage behavioral data, which, in a more agile and rapid manner, allows the application of retail media mechanics within specific journeys.

By capitalizing on this knowledge of purchase intent, retailers provide brands and their agencies with personalized advertising and promotional offers within the consumer's shopping journey. In doing so, brands seek to capture consumer's attention and influence their purchase decisions at the precise moment when they engage with the offering and select their product. Retail media proves to be a valuable means of offering each visitor the product that best suits their needs, taking into account their preferences, interests, progress in the buying process, and thereby building customer loyalty.

Concretely, this influence is manifested through the presence of native ads, also known as 'sponsored products,' and the display of visual elements on various pages such as the home page, category pages, search results, and even product descriptions.

Retail media provides precise traceability and effective measurement of advertising investments. Key performance indicators provide real-time sales data, allowing brands to adjust their campaigns immediately if necessary.

By making this data available to agencies and advertisers, retailers have the opportunity to achieve a significant return on investment. This is especially important in an industry marked by fierce price competition, where the gross margins generated by e-commerce are often slim due to the increased complexity of operations associated with this sales channel.

The strategic importance of retail media and the opportunities it presents have thus sparked the interest of general advertising agencies and retailers, leading them to collaborate in establishing platforms specialized in e-commerce.

A concrete example is the joint venture between Carrefour and Publicis, combining the strengths of retail media from both entities: the 'Citrus Ad powered by Epsilon' technology, acquired by Publicis in 2021, along with the data and inventory from Carrefour Links on Carrefour's side.
Other retailers have also chosen to internalize this expertise by developing their own advertising platforms. An example is Cdiscount, which launched Cdiscount Advertising. Similarly, the Casino Group (including Monoprix, Géant Casino, Franprix, among others) and Intermarché jointly initiated 'Infinity Advertising' since September 2021, an advertising agency and a data platform shared by both brands. Another example is Auchan and Boulanger - both part of the Mulliez Group - which have entrusted the monetization of their online and offline retail media inventory to Valiuz Adz, a new advertising agency created specifically for this purpose.

The strength of retail media platforms lies in their ability to operate programmatically, meaning to automate the delivery of relevant content and products to the right audience at the right time. It's worth noting that it is possible to implement traffic optimization practices for your e-commerce site without necessarily being a giant in the industry. Some of these practices - such as highlighting brands or promotions - can be manually accessible.

Retail media, therefore, has a promising future! It is a key element of growth for both retailers and brands, with its performance and relevance continually improving. In essence, retail media is getting closer to marketers' dreams: delivering the right message to the right person at the right time.

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