With UK retail media spend outside of Amazon on course to surpass £1 billion in 2025, the channel is firmly establishing itself as one of the go-to avenues to reach consumers. However, any fast-growing opportunity is also going to come with plenty of challenges that must be overcome.
In many cases, media agencies will be tasked with taking on these challenges for their clients and producing the results that brands expect. But the channel – and the approach of some agencies to the channel – isn’t quite yet positioned in a way that is entirely beneficial to the parties involved.
“It’s very difficult for a brand or agency to scale, because we’re a very fragmented market. We’re a very fragmented region,” said Jill Orr, Managing Director, Enterprise EMEA at Criteo, speaking at Stratacache’s ‘What’s in store for retail media networks London’ event.
“Every agency, their objective and how they think about how retail media sits within their business, within their different agency brands, within their different clients, is very different right now. And, actually, the only thing that’s consistent is that it keeps changing. So, you have to be very fluid in how you work and try to understand the bigger, long-term objective than what’s being presented to you right now.”
Where agencies can begin to tackle this fragmentation is by creating dedicated centres of excellence that are responsible for retail media, according to Uche Ofili, Head of Agency at SMG.
“What I’ve seen over the last four or five years, it’s very much been about education from an agency perspective, and making sure that we are championing retail media within the agencies,” he said. “Most importantly, what we’re seeing in our commerce functions is the centres of excellence popping up within agencies. That’s usually where the stickiness is from a retailer perspective.”
Publicis Media’s Retail Strategy Lead, Amo Aujla-Tse, was in full agreement with the notion of centres of excellence providing a better basis for agencies to produce for clients within the retail media space.
“A centre of excellence works much better, because you have a whole hub dedicated, across the funnel, to retail media, and they’re complementing existing channel specialists who are already working with tons of partners,” she said. “If the onus is on a handful of people in one specialist team, it becomes more manageable.”
Realising the retail media opportunity
Retail media’s rise in prominence also presents a significant challenge for the smaller retailers in particular, as “just because you’ve got a retail media proposition, it doesn’t mean that people are going to buy it. You have to give brands and agencies a reason to shift their marketing budget,” according to Orr.
Many agencies will be tasked with spending significant amounts of their budget on Amazon, and the rest will likely be directed to the major retailers. “So, if you’re a smaller, evolving, retail media network, how do you get noticed? How do you make it easy for that planner/buyer to be able to use their budget? And that’s the really big challenge,” said Orr.
“If I’m in a retail media network and I’m starting to share my data, what am I really adding? Am I sharing more of that inside the brand, but less with the agency? So, how does that brand and agency work effectively together? And what am I enabling them to do? Am I only enabling them to plan using that data, or can they optimise throughout the campaign on that data, or does that sit somewhere else in the ecosystem?”
From a Publicis point of view, there is room to work with the smaller retailers and retail media networks, because “we obviously want to test, learn, and scale new opportunities, so that we’re not rinsing and repeating the same plans,” stated Aujla-Tse.
However, agencies have to consider the priorities of their clients and, as such, it’s imperative they’re given the right avenues to collaborate with other retailers and retail media networks.
“Where we’re able to lean into those new opportunities is when we’re able to get those insights. Access to self-serve data platforms is fantastic, but put yourself in our shoes,” said Aujla-Tse. “We work with multiple retailers, who are now offering self-service data opportunities, fantastic, but also very challenging, because we have to log into multiple different dashboards to get a snapshot of our client’s shopper behaviours, audiences etc.”
