Retailers Step Up In-Store Media in Bid for Advertiser Spend

As retailers feel shoppers’ belt-tightening behaviors hurt sales, many are turning to in-store retail media to increase their revenue and profit margins.

Mega-retailer Walmart, for its part, shared in a news release Monday (April 1) how it is expanding its efforts in the space.

“The shopping journey isn’t linear, making omnichannel connections even more critical to brands,” Rich Lehrfeld, senior vice president and general manager at Walmart Connect, the chain’s retail media business, wrote. “That’s why we continually explore new media experiences that both help marketers solve their needs across the entire funnel and are additive to the customer’s shopping journey.”

Lehrfeld added that the retailer is adding more in-store demonstrations and sampling, offering self-serve in-store campaign management for advertisers beginning with television wall ads, and adding more media partners while rolling out capabilities from its existing partnerships with Roku and TikTok.

Meanwhile, Digiday reported that Thursday (March 28), The Home Depot hosted an event dubbed InFront to show off its rebranded retail media business, renaming it Orange Apron Media from Retail Media+, which includes new in-store advertising capabilities.

In February, convenience store chain Wawa announced its new Goose Media Network retail media network in partnership with Publicis Sapient, Epsilon and CitrusAd, which offers, in addition to digital opportunities, on-site advertising at the gas pump.

“Goose Media Network elevates convenience by delivering offers to customers right where they shop and allows us to build new connections with our customers and partners’ brands,” Melissa Seabright, the retailer’s advertising manager, said in a statement.

One of the most direct benefits of in-store retail media is the opportunity to unlock new revenue streams. By partnering with advertisers and brands to display sponsored content or advertisements within their physical spaces, retailers can generate additional income beyond traditional sales. The revenue generated from these collaborations can help offset operational costs and enhance profitability.

These initiatives can be all the more important as consumers cut back. The February/March PYMNTS Intelligence report, “New Reality Check: The Paycheck-to-Paycheck Report: Why One-Third of High Earners Live Paycheck to Paycheck,” which draws from a census-balanced survey of more than 4,200 U.S. consumers, finds that 60% of shoppers have cut down on nonessential purchasing due to retail product price increases. Plus, half have turned to cheaper merchants, and 45% of low-income consumers have shifted to purchasing lower-quality products, as have 41% of middle-income and 28% of high-income shoppers.

In-store retail media can play a significant role in improving conversion rates — the percentage of store visitors who make a purchase. By strategically placing digital displays or interactive kiosks near relevant products or high-traffic areas, retailers can effectively guide customers through the purchasing journey and encourage them to buy. For example, dynamic product demonstrations or customer testimonials displayed on digital screens can help customers visualize the benefits of a product, leading to increased confidence and higher conversion rates.

Indeed consumers, for their part, continue to seek out in-store experiences, per PYMNTS Intelligence’s “2024 Global Digital Shopping Index: The Rise of the Click-and-Mortar Shopper and What It Means for Merchants,” commissioned by Visa Acceptance Solutions. The study, which drew from a survey of nearly 14,000 consumers across seven countries, found that 71% of consumers prefer to interact with brick-and-mortar stores at some point in their shopping journey. Specifically, 14% prefer to place orders digitally for in-store pickup, another 25% prefer to shop in stores with the assistance of digital technologies, and 1 in 3 like to shop the old-fashioned way.

Additionally, effective in-store media can help retailers shape brand perception and foster loyalty among customers. By creating immersive and memorable experiences that resonate with their target audience, retailers can strengthen their brand identity and differentiate themselves from competitors. Positive brand experiences in-store can lead to increased customer satisfaction, loyalty, and advocacy, ultimately driving repeat business and long-term profitability.

The post Retailers Step Up In-Store Media in Bid for Advertiser Spend appeared first on PYMNTS.com.