Fragmented retail media networks are worsening consumers’ shopping experiences, according to new research from global advertising and marketing technology company, Epsilon.
The findings are a cause for concern in the industry, as retail media, the practice of marketing at or near a consumer’s point of purchase or at the point of choice between competing brands and products has become increasingly popular across the marketing industry in recent years.
According to Epsilon’s survey of 689 mid-to-large-sized brands and retailers across 12 countries, 64% of brands believe the existence of multiple technology providers in retail media networks results in a poor advertising experience for consumers.
In the UK, almost half (48%) of respondents agree that the presence of multiple tech providers impacts shoppers negatively.
Fragmentation hurts consumers most
Brands and retailers are equally frustrated by fragmentation, with survey respondents identifying inconsistent targeting and disparate reporting across channels as the top inefficiency driver of retail media - but it’s shoppers who pay the price,
Joe Doran, Chief Product Officer at Epsilon, said: “The consumer experience is too often overlooked in the retail media frenzy.
“We’re so caught up in the hype around the latest offerings that we ignore the fact that fragmentation leads to poor advertising experiences and frustrated shoppers.
“I believe solutions that focus on messaging individual shoppers across channels deliver better performance. Brands want to talk to existing and potential in-market shoppers and retailers should facilitate those conversations at scale and across channels that can reach in-market shoppers wherever they may be in the consumer journey. So, when we put the individual shopper at the centre of the advertising, everyone wins.”
Potential of open web is being neglected
The survey further identified that retailers are not using the open web’s ability to reach shoppers to its full potential, with just 37% of retailers currently using off-site programmatic advertising methods for retail media monetization, this figure falls to 19% in the UK.
Brands want easy-to-use retail media networks that can reach more shoppers but inconsistent targeting was found to be the biggest source of retail media inefficiency across channels and tactics, agreed upon by 43% of those surveyed.
In terms of retail media priorities, 76% of all respondents believe the quality of advertiser experience is the most important aspect for their organisations while 75% believe the amount of inventory available is the most important.
Adam Skinner, Managing Director of Retail Media Networks at CitrusAd, added: “Good technology is fundamental to good retail media. Brands and retailers must navigate a sea of constantly growing and changing retail media technology partners while responding to more volatile consumer behaviours.”
Broadly speaking, the prevalence of retail media is expected to grow into the future with 48% of brands expecting their retail media investments to increase over the next three years, however, brands and retailers should be more careful to ensure they are maximising their investments by utilising off-site, open web capabilities and minimising fragmentation.
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