For our Evolution of E-commerce Deep Dive, we break down exactly what brick-and-mortar retailers Tesco, Asda, Sainsbury’s and Boots are offering marketers as they set about monetizing their considerable ad real estate.
Retailers are looking to better monetize their ad real estate, loyalty scheme data and generate insights to provide a better marketing loop for brands in need in guidance.
Retail media is booming. Boston Consulting Group (BCG) estimates that the market will grow by 25% a year over the next five years to be worth $100bn and account for over 25% of total digital media spending by 2026. eMarketer meanwhile forecasts that US retail media networks will exceed $52bn in ad sales by 2023. And it’s not all Amazon any more. According to a study from McKinsey, 80% of advertisers currently use at least one retail media network in addition to Amazon.
It’s time for the nation’s biggest brick-and-mortar retailers to take a slice of the pie. Here’s what they are offering.
Tesco offers the largest and arguably most mature retail media product in the UK. This includes a network of 500 digital screens (the most in the UK) that it claims reaches 75% of its in-store shoppers. Much of this media is newly self-serve through Tesco data hub Dunnhumby Sphere.
It is underpinned by data from the Tesco Clubcard, which is now used in 80% of transactions by more than 20m households in the UK. Tesco says this data can not only help marketers target ads across its vast media real estate, but enable them to shape new products coming to market.
From a media perspective, its website and app saw 65m visits in 2021, opening opportunities in display and search advertising.
Instore, beyond its DOOH footprint, are opportunities for in-store radio promotions and ads on scan-as-you-shop and self-serve units.
Tesco is also talking up co-branded partnerships on Facebook and soon into the world of CTV. And then there’s its insights team, informed by the buying decisions of millions of loyalty card users that can be used to help dictate purchase trends, pricing flexes and offer a level of attribution to all of its media activity.
There has long been a crossover between the retail media developments of America’s Walmart and its former UK subsidiary Asda, from even as early as 2017 with the extension of the private ad exchange, Walmart Exchange. Even then it was promising precise targeting on its online assets using customer data, with Lucozade the first brand to give it a try.
Now, Asda Media Partnerships leverages Asda’s owned and operated platforms to help brands reach customers throughout the online buying journey.
Alex Crowe, who was at the time head of Asda Media Partnerships, recently told The Drum: “As a retailer, we are in a unique position to understand what customers are buying, be it by store, day of the week or time of day, and with what other items.
“So, with the dynamic assets and rich data you can drive customer relevancy at the point they’re making decisions, then provide comprehensive reports on the success of the campaign – both soft measures and harder metrics such as the impact on sales.”
Inside, it offers access to hundreds of digital six sheets as well as further promotion through social accounts and its in-store radio. This is all underpinned by data from the Asda Rewards app.
Meanwhile, supermarket Sainsbury’s retail media footprint is operated by Nectar 360, owner of the Nectar loyalty card.
It recently launched a new self-service offering to support its digital trading platform that will let brands buy its media at their own discretion using Nectar-gathered shopper data across digital media. It has also been working with Publicis-owned CitrusAd to develop the media offering on its website, encompassing display and search ads.
There are also the in-store ad opportunities, some 300+ motion sheets, as well as canvas/print opportunities. All in, Clear Channel estimates this real estate has more than 20m impacts every two weeks.
Morrisons was the last of the big UK grocers to reveal a retail media network that will develop and deliver marketing campaigns for brands, dropping its announcement in September 2022.
It is working with advertisers to create ad campaigns based on customer insight derived from its MyMorrisons loyalty scheme and e-commerce data.
It has yet to reveal the full suite of media space it has to offer, but will have digital inventory across its real estate in some of its 497 stores across the UK and 300+ petrol stations. It will also ramp up its inventory on shopping channels such as Morrisons on Amazon and lean heavily into working with its delivery partners, including Deliveroo.
Its bespoke unit, Morrisons Media Group, offers brands reach in-store and online, as well as “connected campaigns across third-party channels, including digital and social“. This is supported by “dedicated account management and a full-service approach from campaign planning to concept development,“ as well as “clear ROI reporting“.
The retailer recently slid out of the ’Big Four’ retailers, overtaken by Aldi. To be an effective retail media outlet, it must – like any media company – ensure high footfall/viewers to ensure a scale worth buying.
An honorable mention goes to the UK’s biggest pharmacy retailer, Boots, which has long pushed the benefits of the Boots Advantage Card (now more than 25 years old). This scheme brings the data of more than 17 million active users across 2,400 stores and online to brands.
On the table are in-store, app and online advertising, with the digital footprint encompassing 1bn website visits a year. It also offers the opportunity to take co-branded ads into owned and third-party channels in display, video, social, direct mail, email and vouchers.
Said media is easier to buy through the recently formed Boots Media Group, backed by a partnership with commerce marketing organization Threefold.
For more on the Evolution of E-commerce, check out The Drum’s latest Deep Dive.