How in-store technology will bolster retail media networks

Retail media networks (RMNs) are getting more support from in-store technologies, according to a new report by the IAB. The report, “Quantifying Retail Media In-Store Success: Measurement & Innovation,” coincides with the National Retail Federation (NRF) conference in New York.

Also, the IAB will launch a digital out-of-home (DOOH) and in-store retail media working group on Feb. 7. The group aims to develop a playbook for retailers, agencies and brands on how to plan media, define measurement and understand specific in-store technologies and use cases.

Why we care. RMN advertisers said last year they’d increase their budget, on average, by 11%. Brands with budgets over $30 million said they’d increase their spend by 15%. Most RMN opportunities, however, are through retailer digital channels, like website search, or through off-site advertising, not in-store.

Dig deeper: How Home Depot and Kroger use RMNs to improve shoppers’ ad experience

In-store audiences. Although splits vary, major retail chains with RMNs tend to have a larger in-store audience than on digital channels.

Here’s the breakdown for some major retailers:

RMN touchpoints. The in-store shopping experience at many retailers can be made more dynamic with these current and emerging technologies:

• Smart screens in aisles and smart kiosks allow shoppers to search for in-stock items and learn more about products and sales promotions.
• Audio programming that can be customized by location and audience profiles of those who visit the store.
• Beacon network in-store that powers specialized mobile apps to engage shoppers and measure traffic patterns. This technology has been around for years. One major retailer, Best Buy, deploys a network with over 5,000 beacons at U.S. stores, according to the IAB report.

Measurement technology. In-store devices and screens aim to improve customer experience while also creating new data streams to measure the impact of ads. In addition to the touchpoints above, other technologies can be added in-store to better measure customer behavior and ad performance. These include:

• Visual sensors in stores that gather anonymized data about traffic patterns and confirm ad views when a shopper pauses to look at a screen.
• Shopping cart and basket sensors that can monitor interactions with in-store media.
• Passive Wi-Fi in stores that can count the number of shoppers by mobile devices that use the service.

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Data use and technology. Advances in RMNs helped by in-store technologies will add to benefits for advertisers and retailers, according to the report. These benefits and capabilities include:

• Real-time data analytics: Retailers use real-time data processing to gain immediate insights into customer behaviors and preferences, allowing them to swiftly adjust marketing strategies and enhance the shopping experience. 
• Predictive modeling: Machine learning algorithms enable retailers to forecast future trends, demands, and customer behaviors, leading to more effective inventory management and targeted marketing efforts. 
• Dwell time analysis: By measuring the time customers spend in specific store areas, retailers gain insights into engagement levels, informing decisions about store layout, product placement, and promotions. 
• AI-powered customer segmentation: This approach supports precise, real-time customer segments based on anonymized attributes including age, gender and group composition layered with contextual attributes, such as in-store proximity to certain categories or brands, enabling highly targeted and relevant marketing. 
• Customized content delivery: Dynamic adaptation of content based on real-time data ensures that marketing messages are highly relevant and engaging to the audience present. 
• Unified data sources: Integrating real-time data streams into an existing tech stack creates a sustainable, common media currency, and facilitates real-time audience-based programmatic bidding and activation.