In the ecommerce realm, we’ve seen retail media networks emerge and accelerate. But industry experts believe that the real power of these media networks lies within the four walls of the store.
During a recent retailX webinar, a panel of executives representing packaging, supply chain operations, data and analytics, digital optimization and in-store experience came together to discuss the potential of the “Store as Media” model, how it operates and what is required for success. Panelists included:
- Steve Brown, VP of Marketing and Innovation, WestRock Co.;
- Jay Hutton, President and CEO, VSBLTY;
- Maroun Ishac, Director of Business Development, Retail Solutions Division, Intel Corp.; and
- John Dwyer, VP of Business Development, WestRock Co.
Conversations surrounding “Store as Media” have ramped up amid the rapid acceleration of digital behaviors. Brown noted that although many retailers have done well with online during this period, consumers are expressing a desire to go back to stores and are seeking greater integration between these experiences. As a result, retailers will need to think about how they can embrace these digital behaviors and use a combination of QR codes, digital signage and personal smartphones to make the store a more engaging place.
“Retailers have created Retail Media Networks to compete with the Amazons, Facebooks and Googles,” Brown explained. “These Retail Media Networks have largely focused on the web and apps, but we see an enormous opportunity to leverage the ‘Store as Media’ channel, driving advertising and precision marketing to keep shoppers engaged.”
The potential of Store as Media aligns with the ongoing discussion around the future of brick-and-mortar. Industry players overall agree that the store is not dying, it’s being reinvented and, by necessity, becoming more experiential. However, Ishac argued that many retailers are taking the wrong approach in their response plans.
“The knee-jerk reaction for some retailers is to downsize or marginalize the role of the stores,” he noted. “Others are adopting omnichannel to make all channels act as one. We’re arguing that this risks oversimplifying what’s really happening; that what’s actually evolving is a new, more complex role of the store.”
That is why we’re seeing digitally native direct-to-consumer (DTC) brands develop more aggressive brick-and-mortar strategies, Ishac noted. “They’re affirming [this reality] by creating their own stores. They recognize that in order to fully actualize their brand, they need to create remarkable experiences for consumers, not to move product but to move the hearts and minds of consumers; to sell the idea, essence and values of that brand.”
‘Store As Media’ Drives Tangible Benefits for Retailers, Brands and Consumers
By embracing the “Store as Media” model, brands and retailers have the opportunity to deepen engagement with consumers, using the best of technology and data to create more personalized and contextual interactions in all areas of the store — in the aisle, at an endcap and even at the point of sale. This technology and data also brings big benefits for brands and retailers that want to create advertising campaigns and content that converts.
“Digital advertising in retail has existed for about 30 years, but it’s all been analog,” said Hutton. “You would buy [an ad] and hope like heck it performs. The benefit of the digitization of retail is it [now] comes with the benefits of computer vision to measure the experience.” Advertising firms and brand executives measure campaign success based on the number and quality of impressions, he added. Bringing digital into the physical world allows you to deliver these impressions at the most meaningful point in time, which benefits the brand and retailer as well as the customer.
Consumers can even see benefits when they venture back to their homes, thanks to the power of connected packaging that allows them to access relevant, meaningful content about the products they plan to buy. Creating this constant loop of engagement is what makes the Store as Media model most effective, according to Dwyer.
“For this model to work, we have to engage consumers in a shopping environment, as opposed to a buying environment,” Dwyer explained. From the supply chain to the store, “the product itself has to have a voice. Consumers want to know more about the products they’re bringing home…and understanding what they’re doing at home plays a critical role in understanding these consumers on a deeper level.”
For example, a cereal box is taken in and out of the pantry an average of seven times before its depletion, Dwyer explained. What if the brand could use those moments to engage and empower consumers in a more meaningful way? “If a product can’t communicate what it is, where it came from, how it can be used effectively, and how it should be disposed of at the end of its lifecycle, then [the brand] is just missing the point.”
Other notable benefits both brands and retailers can expect with the Store as Media model include:
- A predictable, scalable revenue model;
- A sales lift of up to 35%;
- A more effective way to monetize real estate;
- Improved customer engagement;
- More impactful, “context aware” campaigns; and
- The ability to create an endless aisle experience that doesn’t require associate intervention.
But to make Store as Media a reality, the collective retail industry needs to create an ecosystem that includes digital signage, mobile apps, computer vision, analytics, packaging and other tools and capabilities. That totals “a lot of moving parts in an environment that’s not all that tolerant of moving parts, so an ecosystem is the only way this can be dealt with,” Hutton explained.
Ishac agreed, adding: “We must build a digital media network in the store that is end-to-end intelligent: intelligent in the cloud and intelligent at the [shelf] edge. We absolutely must collaborate as a consortium and as an industry to deliver upon new brand, retailer and consumer expectations.”